Answer:
Option D- The unit product costs of high volume products typically decrease and the unit product costs of low volume products typically increase.
Explanation:
The reason is that the company has batch level costs which are fixed indirect costs that are to be assigned to the product and are fixed amounts say $100. Also assume that there are two type of units, Unit A and B. Suppose that the batch cost any number of units of A produced will remain the same and similarly for product B. This means if the units produced of A are at 20 unit per batch and product B produced are 10 units per batch then Activity Based Costing says that the unit cost of batch cost absorbed in Product A would be $5 ($100 / 20) and that for product B would be $10 ($100 / 10). So this example better explains cost behavior of batch cost which is fixed for different levels of production.
This means the fixed cost per unit which decreases with increase in production will keep decreasing if the number of units produced starts increasing. In other words, the similar class of units if are produced in higher quantity then the cost per unit will be decreased due to decrease in fixed cost per unit and vice versa.
When a monopolist's level of output is not at the minimum point of <u>average total cost</u>, this means it will not be productively efficient.
<h3>What is an
average total cost?</h3>
An average total cost refers to a cost derived from total fixed and variable costs divided by total units produced.
In conclusion, this cost is used to evaluate how the total per-unit cost change as a result of output
Read more about average total cost
<em>brainly.com/question/25109150</em>
Answer:
1. Year 1 expected value = $32.24
2. Required rate of return = 7.35%
Explanation:
1. For computing the stock price which is expected 1 year from now is shown below:
= Current Price × (1+rate)^number of years
= $31 × (1+0.04)^1
= $31 × 1.04
= $32.24
Hence, the expected 1 year value of stock price is $32.24
2. The required rate of return is computed by using an formula which is shown below:
= (Current Year dividend ÷ Current stock price)+ growth rate
where,
current year dividend is = D1
And, D1 = DO × (1+g)
where,
DO = previous dividend share
g = growth rate
So, $1 × (1+0.04)
= $1 × 1.04
= $1.04
Now apply these values to the above formula
So, required rate of return is equals to
= ($1.04 ÷ $31) + 0.04
= 7.35%
Hence, the required rate of return is 7.35%
Answer:
Cash price of the car
= Down payment + A(1 - <u>(1+r/m)</u>-nm
r/m
= $2,200 + $200(1-<u>(1+0.11/12</u>)-4x12
0.11/12
= $2,200 + $200(1-<u>(1+0.0091666667</u>)-48
0.0091666667
= $2,200 + $200(1-(<u>1.009166666667</u>)-48
0.0091666667
= $2,200 + `$200(38.691421)
= $9,938
Explanation:
The cash price of the car is equal to the down payment plus the present value of the monthly installment. The present value of the monthly installment is obtained by using present value of annuity formula.
