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Suppose you are considering starting your own consulting firm. You estimate if that if you did not start the firm, your starting salary at a job would be $40,000/yr. The revenues from this firm are expected to be $1,500,000. Some of the expenses you expect to encounter is $25,000 for an employee and operating costs (rent, supplies, utilities, etc.) of $500,000. To begin the business, you must borrow $100,000 from the bank and pays 8% interest in the loan and also uses $50,000 of your own money that was in a savings account previously earning 2% interest. Equipment (computers, etc.) will cost $20,000.
a. Determine the pre-tax accounting profit of this firm
b. Determine the pre-tax economic profit of this firm
c. Which costs are explicit and which costs are implicit?
In class we discussed how companies go about making decisions related to important purchases. One method of making an informed purchasing decision is total value sometimes call life-cycle costing. You are a sales person for Sherwin-Williams and sell ..
In 2011 the "Occupy movement" spread from New York to a number of cities across North America to protest the uneven income distribution. In Vancouver one of the key issues was the high cost of owning or renting a home (Vancouver has some of the highe..
Explain what is meant by a central versus peripheral route to persuasion and the factors that would determine when each might be used by consumers in response to an advertisement.
The type of manuscript for this book was typed for free by a friend. Had I hired a secretary to do the same job.
Discuss each of the pricing strategies below. What conditions are necessary to make each strategy successful in terms of increasing profits? Explain your answer.
q1. when the price of ford pickup trucks rises from 18000 to 19000 the quantity of chevy trucks demanded increases from
How does the adverse selection problem arise in the credit- card market? How do credit- card companies reduce the adverse selection problem that they face? To what complaint does this give rise?
What is the necessary requirement to turn a business idea into a business? If you don't have customers willing to buy your new product or service at a price that gives you a profit, do you really have a business?
Would you advocate monetary restraint or stimulus for today's economy
The environmental protection agency of a county would like to preserve a piece of land as a wilderness area. The current owner has offered to lease the land to the county for 20 years in return for a lump-sum payment of $1.1 million, which would be p..
Social life can be interpreted from one of three major theoretical frameworks. Describe the major points of each framework. List at least one sociologist who has been identified with each framework.
Suppose that the demand for bentonite is given by Q = 40 ? 0.5P, where Q is in tons of bentonite per day and P is the price per ton. Bentonite is produced by a monopolist at a constant marginal and average total cost of $10 per ton. How much profit i..
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