JRJ Corporation recently issued 10-year bonds at a price of $1,000. These bonds pay $60 in interest each six months. Their price has remained stable since they were issued, that is, they still sell for $1,000. Due to additional financing needs, the firm wishes to issue new bonds that would have a maturity of 10 years, a par value of $1,000, and pay $40 in interest every six months. If both bonds have the same Yield to Maturity, how many new bonds must JRJ issue to raise $2,000,000?(Hint find the YTM of first bond the find the value of 2nd bond)
Answers
Answer: 2596 bonds
Explanation:
The following information can be gotten from the question:
Coupon rate = 8.0%
Face value = 1000
Year to maturity = 10
NPER = 20
PMT = Face value × Coupon rate / 2 =(1000 × 0.08) / 2 = 80/2 = 40
Yield = 12%
Rate = Yield / 2 = 12% / 2 = 6%
We then calculate the net proceeds which will be:
= PV(rate, NPER, PMT, FV)
= PV(6%, 20, 40, 1000)
= $770.60
We should note that the amount that needed to be raised is $2,000,000. Therefore, the bond that will be needed to be sold will be:
= $2,000,000 / 770.60
= 2596 bonds
Related Questions
how does scarcity, opportunity cost, and choices relate to each other in economics
Answers
Answer:
Economics is a social science that examines how people choose among the alternatives available to them. Scarcity implies that we must give up one alternative in selecting another. ... The opportunity cost of any choice is the value of the best alternative that had to be forgone in making that choice.
A reporting relationship in which an employee receives orders from, and reports to only one supervisor is known as:
Answers
Answer:
According to the concept of unity of command, each level of the organizational hierarchy has only one supervisor who is responsible for each employee. This holds true even if a collection of individuals leads the organization's top. Consider being the CEO of a Silicon Valley-based technology company as an illustration. While the board of directors of your company oversees policy-making and strategic planning, you solely report to the chairman of the board in accordance with the unity of command principle. however, have a supervisor for your unit who reports to her department manager. The vice president of operations, who reports to the CEO, is the department manager's superior. The board of directors' chairman is the CEO's subordinate.
Answer:
unity of command
Explanation:
Being accountable and answerable to more than one supervisor is never liked by the employees. Unity of Command is the one business management theory that resolves this issue.
According to the Principle of Unity of Command, there shouldn’t be a group of supervisors for a single subordinate or a single team working for a company.
For example, the HR team of a company will have just one supervising head instead of two or three to have an orderly set up in the work atmosphere. With the help of the Unity of Command principle, there is a proper hierarchy that is set in the company.
Researchers plotted a distribution curve for leg length in a population of birds, with length from short to long on the x-axis. The curve shifts to the right after a disturbance. Which statement is correct about natural selection in this population of birds?
Birds with long legs were selected for.
Birds with long legs and birds with short legs were selected for.
Birds with medium-length legs were selected for.
Birds with short legs were selected for.
Answers
The correct statement about natural selection in the population of birds is "C-Birds with long legs were selected for". Option (a) is correct.
What is Natural Selection?The process through which populations of living things adapt and evolve is known as natural selection. A population's members are naturally varied, which means that they are all distinctive in some respects. This variety indicates that some people have characteristics that are more environment-appropriate than others.
Natural selection in the population of birds experiences probably favored individuals with longer legs, as they are more likely to survive the disturbance.
Therefore, Option (a) is correct.
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A property manager can refuse to rent to applicant Mike for any of the following reasons except which? Mike has changed jobs six times in the past six months. He is married with two children. Mike has been late with his rent payments seven times in the past year. He had a serious physical altercation with his downstairs neighbor.
Answers
Answer:
He is married with two children
Explanation:
Types of Real Estate property
1. Industrial
2. Commercial
3. Agricultural
3. Special-purpose
4. Recreational
5. Investment etc.
Four types of tenancies.
They includes;
1. Term for years (or fixed term)
2. Periodic tenancy
3. Tenancy at will
4. Tenancy by sufferance
Leasehold
This is often called rent. It is an estate in a land that gives the tenant the large(exclusive) right of possession for the time period (duration) of the lease.
There are several reasons why a property owner may deprave a tenant or someone from renting a particular house or place but not because of marriage or children.
Lease may contain a list of certain prohibited activities on or about the rented premises such as:
(1) Pet on Property
(2) Smoking-
(3) Commercial activities
(4) Number of occupants-
When enterprises behave as good citizen, towards which group are they showing their responsibility?
Answers
Answer:
When enterprises behave as good citizens, they are showing their responsibility towards society as a whole. This includes responsibility towards the environment, the local community, employees, customers, and other stakeholders. It involves acting in an ethical and socially responsible manner, beyond just making profits. Good corporate citizenship includes activities such as promoting sustainability, supporting local causes and charities, treating employees fairly, and being transparent and accountable in business practices. Ultimately, good corporate citizenship is about making a positive impact on society and being a responsible member of the community.
Explanation:
Explain the positive and negative aspects of entrepreneurship. Draw evidence to support your claim from two other sources.
Answers
Answer:
Advantage #1: A flexible schedule – both in terms of when and where you work. ...
Advantage #3: It's exciting and fulfilling. ...
Advantage #4: The salary makes sense. ...
Disadvantage #1: You wear a lot of hats. ...
Disadvantage #2: You are always at work.
Explanation:
The positive (advantages) and negative aspects (disadvantages) of entrepreneurship are enumerated below:
Control: Entrepreneurship offers the entrepreneur a sense of being in charge and being the captain of the ship. With freedom of control comes increased risk of business failure.Responsibility: The entrepreneur is responsible for her income for life sustenance. There is no more reliance on a period paycheck. The entrepreneur can decide to delight her customers or to scare them away.Flexibility: The entrepreneur enjoys flexibility in work schedule. She works at her own pace. The downside is that your customers dictate when you work. The workload may increase more than your capacity to handle. Thus, flexibility does not happen always until you have established the business properly.Profit-making: As the business makes profits, the entrepreneur is entitled to receive all. When it makes losses, the entrepreneur similarly bears all.Thus, there are numerous benefits in being an entrepreneur. But there are also negative aspects of entrepreneurship.
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According to the growth accounting studies, if you lived in a country where illiteracy was high and 40% of the children left school early and did not complete their education what would probably be the results for that country
Answers
Answer: b. There would be both a human and economic loss.
Explanation:
Education is usually necessary for economic growth as educated human beings are better able to engage in higher income businesses and services and come up with or be able to use better technology that would serve to improve the economy of a country.
This is why developed countries have such high literacy rates and developing countries lag behind. Research has shown that most developed countries really saw growth only after they pursed a national policy aimed at improving literacy.
Potential investment are offering return of 8% per period. Given an initial investment of $2500 how much cash would be available at the end of four periods?
Answers
Answer:
Principle=$2500
Time=4yrs
Rate=8℅
Now,
\( i = \frac{p \times t \times r}{100} \)
\( = \frac{2500 \times 4 \times 8}{100} \)
\( = 800\)
At the end of four periods $800 would be available
hope it helps you
The Clean Water State Revolving Fund (CWSRF) in 1987, a low-interest loan program intended for states replaced the Construction Grants program.
True
False
Answers
Answer:
True
Explanation:
You are on a business trip from Portugal to the United States for 90 days, and you have a per diem expense account of 400 euros, no receipts required. This per diem is advanced to you before the trip (36,000 euros). You deposit it into your checking account and use your Portuguese (euro) credit card to cover your costs while in the United States. After the first two weeks of your trip, the dollar weakens against the euro by 15 percent. What ethical dilemma might this currency fluctuation present for you? How will you handle it?
Answers
The ethical problem is whether to save the extra Euro for personal use and not disclose it to the firm because no receipt is necessary, spend the whole sum of 400 Euros by engaging in other activities, or just return the money.
The activity should be motivated by intent and will adhere to the deontological perspective.
According to this approach, the action should be to spend Euros while on a business trip to obtain additional valuable information for the organization, such as understanding local market conditions, discussions with channel partners, and other activities that go beyond the scope of the business trip within the budget of 400 Euros.
Following that, any Euro saved should be returned to the organization together with a declaration of the dollar's depreciation and any further information obtained.
It will assist the organization in growing and setting a positive ethical example for the personnel, and it will take the utilitarian perspective into account.
Here,
Due to the weakening of the dollar, a less number of euros will be used to buy the same basket of goods and services.
The number of euros required after 2 weeks (after depreciation in dollars) = 400 x .85 = 340 Euros per day
Therefore, the ethical dilemma is whether to spend the entire 400 Euros on other activities, refund the money, or preserve the additional Euro for personal use while keeping it a secret from the company because there is no need for a receipt.
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If you decide to take a break and go for a hike in order to focus less consciously on the creative process, which stage is the creative process are you experiencing?
Answers
Answer: Incubation
Explanation: In the incubation stage the person moves away from the problem and gives space to the mind to search for a solution. An example is going for a walk to relax your mind a bit and ideas flow better.
Kevin McCormick is buying a sports utility vehicle at a car dealership. The base price is $25,565; the factory installed options totaled $2,764; and the destination charge is $495. What is the sticker price?
Answers
Answer:
$28, 824
Explanation:
The sticker price is also known as the MSRP, or the manufacturer recommended retail price. It includes any dealer-installed accessories, any fees, and add-on products plus dealer markup.
The sticker price is this scenario will include
The base value $25,565, plus factory installed options $2,764, plus the destination charge $495.
= $25,565 + $2,764 + $495.
= $28, 824
Opportunity cost college as opposed to workforce?
Answers
Answer:
Because you chose to go to college instead of working, your opportunity cost is actually the sum of your college expenses plus the money you could have earned had you chosen not to work.
Explanation:
The Rational Rule for Buyers O compares the benefit of buying an additional unit of the item to the cost of that item. O compares the total benefit of all units to the total price of all units purchased. O only applies to buyers who are buying necessities as opposed to luxury items. O compares the cost of production of an item to the price of the item.
Answers
The correct option is A. The Rational Rule for Buyers compares the benefit of buying an additional unit of the item to the cost of that item.
Rational rules argue that at least a few significant additives of our ethical structures are indeed ecologically rational: they are proper at assisting us to reap not unusual goals. Nichols argues that the account might be prolonged to seize moral motivation as a unique case of a much extra-preferred phenomenon of normative motivation.
Rational conduct is the cornerstone of rational preference theory, a principle of economics that assumes that individuals always make choices that offer them the very best amount of personal software. those decisions provide human beings with the greatest advantage or pleasure given the alternatives to be had. The monetary rationality precept is primarily based on the concept that humans behave in rational methods and keep in mind alternatives and choices inside logical structures of ideas, in preference to concerning emotional, moral, or psychological elements.
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Complete Question:
The Rational Rule for Buyers
A). compares the benefit of buying an additional unit of the item to the cost of that item.
B). compares the total benefit of all units to the total price of all units purchased.
C). only applies to buyers who are buying necessities as opposed to luxury items.
D). compares the cost of production of an item to the price of the item.
When a route in a transportation problem is unacceptable, the corresponding variable can be removed from the LP formulation. True False
Answers
Answer:
True
Explanation:
suppose that in an hour chip can gather 8 pounds of fruit or 4 pounds of nuts. in an hour, monk can gather 9 pounds of fruit or 3 pounds of nuts. which of the following choices would benefit both chip and monk if trade occurred?
Answers
Chip. in an hour chip can gather 8 pounds of fruit or 4 pounds of nuts. in an hour, monk can gather 9 pounds of fruit or 3 pounds of nuts.following choices would benefit both chip and monk if trade occurred.
The voluntary exchange of products or services between various economic players is referred to as trade. Because the parties are under no duty to trade, a transaction will take place only if both parties believe it is in their best interests. Because of comparative advantage in the production of marketable commodities, trade exists between geographical regions. Bananas grown in the tropics, for example, are marketed to people in cooler parts of the world. Markets are the economic institutions established by frequent commerce amongst a variety of dealers. Trade may be defined as a recurring sequence of exchanges of items. The latter phrase is sometimes used in a broader sense to refer to the location or day of traders' meetings, however this usage will be avoided.
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2. Because parts washers use cleaning solutions that eventually become spent, they must be disposed of properly. A) O True B) O False
Answers
Answer:
The Answer is False
....,....,
The given statement is false because, In manufacturing or maintenance processes, parts washers are frequently used to clean parts or components.
What is the importance of parts washers?Industrial equipment is also called as the parts washers. It supports to clean a piece of equipment of many varieties of waste and pollutants but not merely grease, with recently produced materials, cleaning parts is a prime control procedure.
Cleaning agents used by parts washers finally grow beaten and necessitate to be propelled away or recycled. In a parts washer, solvents are the material of choice for cleaning parts. Grease and oil removal can also be executed with the use of insolvents and water-based solvents.
Therefore, the given statement is false that parts washers must be appropriately disposed of because they employ cleaning solutions that eventually become expended.
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Classification of basic construction refers to:
a. Type of use
b. Type of basic frame, wall, floor, and roof construction
C. Quality of construction
d. All of the above
Answers
Answer:
b
Explanation:
The percentages in the table represent the performance change from the previous month. Consider the impact of
each metric on customer questions.
Metric
Month :
Month 2| Month 3
% Customer Questions
+8%
+10%
+12%
% Shipped On Time
-10%
-7%
-5%
% Shipped Incorrectly
+2%
+4%
+4%
% Discounted
+18%
+18%
+14%
Units Shipped (Thousands)
80
85
100
How impactful was high shipping demand on
customer questions?
Answers
The high shipping demand on customer questions was very impactful, because customers are expecting perfection when it comes to online shopping
How to illustrate the information?The need for goods among the final consumers generates the need for shipping. The demand for shipping is derived rather than a direct demand.
Customers expect perfection when it comes to business so it has a big impact. In this particular process, most business largely failed to satisfy the customer (shipping process). The impacts that can be had are listed below.
In this situation, the high cost causes the customer anxiety, Customers form a negative opinion of the business and are skeptical.
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jones manufacturing has current assets of $26,900, net working capital of 8,200 long-term debt of 21, 500 and total equity of 57,800 what is the equity multiplier?
Answers
Answer:
1.7
Explanation:
The computation of the equity multiplier is shown below:
As we know that
Net working capital = current assets - current liabilities
So,
current liabilities is
= $26,900 - $8,200
= $18,700
And,
Total liabilities = current liabilities + long term debt
= $18,700 + $21,500
= $40,200
Now
Total assets = Total liabilities + Total equity
= $40,200 + $57,800
= $98,000
Now
Equity multiplier is
= Total assets ÷ equity
= $98,000 ÷ 57800
= 1.7
XYZ Corp owns a 3-year $10 million par floating rate bond. The coupons on the bond are 12-month LIBOR. XYZ would like to hedge against interest rates falling by entering into an interest rate swap with a $10 million notional that receives a fixed rate and pays a floating rate (12-month LIBOR). You are given the following prices for zero coupon bonds. Years to Maturity Zero-coupon Bond Price 1 0.99 2 0.97 3 0.93 Calculate the fixed rate XYZ Corp would receive on the swap.
Answers
Answer:
2.45%
Explanation:
The computation of the fixed rate is shown below:
Years to maturity Zero coupon bond price YTM Forward rate
1 0.99 1.01%
2 0.97 1.53% 2.06%
3 0.93 2.45% 4.30%
The fixed rate should be equivalent to the YTM of the 3 year bond i.e. 2.45% the same is to be considered
Tại một doanh nghiệp có tình hình sau:
- Doanh thu của doanh nghiệp từ tháng 1 đến tháng 9 năm báo cáo là
1.500.000.000 đồng.
- Số dư của các khoản TSLĐ sử dụng cho hoạt động sản xuất kinh doanh vào đầu
năm báo cáo là 123.000.000.000 đồng, vào ngày 30/9 năm báo cáo là 127.000.000 đồng,
và số TSLĐ sử dụng vào cuối năm báo cáo được tính theo số TSLĐ đang có vào ngày 30/9
năm báo cáo.
- Số dư của các khoản nợ phải trả bổ sung thường xuyên hợp pháp cho nhu cầu vốn
lưu động vào đầu năm báo cáo là 24.000.000 đồng; vào ngày 30/9 năm báo cáo là
26.000.000 đồng.
- Năm kế hoạch, doanh nghiệp dự kiến sản xuất 100.000 sản phẩm với đơn giá bán
(chưa có thuế GTGT ) là 24.000 đồng.
- Dự kiến tốc độ luân chuyển vốn lưu động năm kế hoạch sẽ tăng 10% so với 3 quý
đầu năm báo cáo.
YÊU CẦU:
1. Xác định nhu cầu VLĐ năm kế hoạch.
Answers
Answer:
222222222222222222222222222
______ is the process of acquiring ownership or control of competitors with similar products in the same or similar markets.
Answers
Setting organizational goals is the process of acquiring ownership or control of competitors with similar products in the same or similar markets.
What is ownership?Ownership refers to the state of legal possession and control of property, which may be a tangible and intangible asset. A property may contain multiple rights, collectively referred to as titles, which may be owned by separate parties. If you have ownership of something, it means you are the owner. it's yours The term refers not only to people, but also to other entities.For example, the state owns state-owned enterprises. The holding company also owns subsidiaries. Company ownership means legal control over the company. This gives the owner legal power to determine business operations and transactions. There are six main ownership structures for companies: One-man business. partnership. Sole ownership refers to property owned in your sole name with no other owner or beneficiary designation. After you die, your personal property usually needs to go through probate court to be transferred from your name to your loved one's name.To learn more about ownership from the given link :
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Mazu Mavuso is a 43-year-old South African resident who was employed by Veg & Fruit Limited, a South African company, until 30 November 2022. On 30 November 2022, Veg & Fruit Limited ceased its operations and the pension fund that Veg & Fruit Limited established for its employees also closed down. The Veg & Fruit Limited pension fund paid out R80 000 to Mazu Mavuso during the 2023 year of assessment. All Mazu Mavuso's pension fund contributions have been deducted in the determination of his taxable Income. Mazu Mavuso also decided to join a retirement annuity fund, to which he made a total contribution of R7 000 during the 2023 year of assessment. For the 2023 year of assessment, Mazu Mavuzo's receipts and expenses were as follow: Salary Director's fees earned Local dividends from South African companies Local interest from a non 'tax free investment' Pension fund contributions at 6.5% of his salary Retirement annuity fund contributions Qualifying medical expenses paid Donation to a qualifying section 18A Public Benefit Organisation R 720 000 110 000 45 000 24 500 ? 7 000 61 630 6 000 Calculate Mazu Mavuso’s taxable income for the 2023 year of assessment. (25 marks) 1.2) Calculate Mazu Mavuso’s total normal tax liability for the 2023 year of assessment. Assume that Mazu Mavuso had a taxable income of: • R770 900 before any retirement fund lump sum withdrawal benefits. • R843 900 after any retirement fund lump sum withdrawal benefits. (17 marks) Competency Framework Reference: E1.2 Interpretation of tax legislation b) Demonstrate the ability to apply the principles of tax interpretation to any new or unfamiliar tax legislation. E1.3 Application of tax legislation to calculate tax obligation a) Analyse the taxpayer’s tax profile. c) Apply the relevant law to the facts, determine the tax position and compute the tax payable (VAT or normal tax) for individuals and companies.
Answers
Explanation:
to calculated this question to solve
Which of the following areas of sports law most related to antitrust?
A. Contracts
B. Monopoly
C. Fan Safety
D. Memorabilia
Which area of sports management is least affected by the law?
A. League regulations
B. Game Outcomes
C. Antitrust
D. Contracts
Answers
1- Areas of sports law most related to antitrust is Contracts.
The contract or conspiracy that illegally restrains trade and promotes anti-competitive behavior. Think of the term anti-competition rather than antitrust.
2- Area of sports management is least affected by the law of Antitrust.
Antitrust law seeks to make enterprises compete fairly. It has had a serious effect on business practices and the organization of U.S. industry.
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A free enterprise system provides individuals the opportunity to make their own economic decisions, without restrictions from the government. It allows the supply and demand of consumers to determine the success or failure of an economic endeavor. As a result, some business owners have become successful, while others have not.
In an essay, you will choose an entrepreneur and argue whether the free enterprise system was necessary for that individual to make an impact on the business world.
Answers
The entrepreneur that is chosen for this argument is Steve Jobs. Steve Jobs was one of the co-founders of Apple, which is now a trillion-dollar company.
The free enterprise system was necessary for Steve Jobs to make an impact on the business world. Steve Jobs did not come from a wealthy background, but he had a passion for technology. The free enterprise system allowed him to start a business without any restrictions from the government.
He was able to create innovative products, such as the iPhone and iPad, and sell them to consumers. The supply and demand of consumers determined the success or failure of his business endeavors. Steve Jobs was able to create a successful company and become a billionaire because of the free enterprise system.
Without the free enterprise system, Steve Jobs may not have been able to start a successful business and make an impact on the business world.
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Windborn Company has 15,000 shares of cumulative preferred 1% stock, $100 par and 50,000 shares of $30 par common stock.
The following amounts were distributed as dividends:
20Y1 $30,000
20Y2 12,000
20Y3 45,000
Common Stock
(dividends per share)
I cannot figure out Y1 or Y3
Answers
The dividends per share for the common stock in year 1 (Y1) is $0.60 per share, and in year 3 (Y3) is $0.90 per share.
To calculate the dividends per share for the common stock in year 1 (Y1) and year 3 (Y3), we need to determine the total dividends distributed and divide them by the number of common shares outstanding.
Given information:
Cumulative preferred stock: 15,000 shares, 1% dividend
Common stock: 50,000 shares, $30 par value
Dividends distributed:
Y1: $30,000
Y2: $12,000
Y3: $45,000
First, let's calculate the dividends per share for the cumulative preferred stock in each year.
Dividends per share for cumulative preferred stock = (Par value * Dividend rate) / Number of preferred shares
Dividends per share for cumulative preferred stock = ($100 * 1%) / 15,000 shares
Dividends per share for cumulative preferred stock = $1 / 15,000
Dividends per share for cumulative preferred stock = $0.000067 per share
Now, let's calculate the dividends per share for the common stock in year 1 (Y1) and year 3 (Y3).
For Y1:
Total dividends for common stock = Dividends distributed - (Dividends per share for cumulative preferred stock * Number of preferred shares)
Total dividends for common stock = $30,000 - ($0.000067 * 15,000)
Total dividends for common stock = $30,000 - $1.005
Total dividends for common stock = $29,998.995
Dividends per share for common stock in Y1 = Total dividends for common stock / Number of common shares
Dividends per share for common stock in Y1 = $29,998.995 / 50,000 shares
Dividends per share for common stock in Y1 = $0.5999799 per share (rounded to $0.60 per share)
For Y3:
Total dividends for common stock = Dividends distributed - (Dividends per share for cumulative preferred stock * Number of preferred shares)
Total dividends for common stock = $45,000 - ($0.000067 * 15,000)
Total dividends for common stock = $45,000 - $1.005
Total dividends for common stock = $44,998.995
Dividends per share for common stock in Y3 = Total dividends for common stock / Number of common shares
Dividends per share for common stock in Y3 = $44,998.995 / 50,000 shares
Dividends per share for common stock in Y3 = $0.8999799 per share (rounded to $0.90 per share)
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Increased capital investment is generally used for what business expenses?
A:capital expenditures
B:employee compensation
C:inventory purchases
D:health insurance
Answers
Which of the following are the three fundamental aspects of business communications
defined in this training?
A. Content, Consistency, Conditions
B. Content, Channels, Conditions
C. Conditions, Listener/Receiver, Channels
D. Channels, Purpose, Timing
Answers
The postal service of St. Vincent, an island in the West Indies, recently introduced a limited edition deluxe souvenir sheet priced at $15.00 each. The initial market response was quite positive, with an increase in unit sales compared to the regular souvenir sheets. The postal service sold a total of 50,000 units of the deluxe souvenir sheet.
Based on the given information, calculate the following:
What was the postal service's increase (decrease) in total contribution margin when it sold 50,000 deluxe souvenir sheets at $15.00 each, compared to selling 80,000 regular souvenir sheets at $8.00 each?
By what percentage did the St. Vincent post office increase the selling price for the deluxe souvenir sheet compared to the regular souvenir sheets? Additionally, calculate the percentage increase in unit sales for the deluxe souvenir sheet compared to the regular souvenir sheets. (Round your answers to one-tenth of a percent.)
If the postal service wants to maintain the same total contribution margin per unit for the deluxe souvenir sheets as it did for the regular souvenir sheets, what selling price should they set for the deluxe souvenir sheet? (Round your answer to the nearest whole dollar.)
Calculate the number of deluxe souvenir sheets the postal service would need to sell at the price determined in question 3 to equal the total contribution margin earned by selling 80,000 regular souvenir sheets at $8.00 each. (Round your answer to the nearest whole number.)
Please show your calculations and provide explanations for each answer.
Answers
1. the postal service experienced an increase in total contribution margin of $7.00
2. The unit sales for the deluxe souvenir sheets decreased by 37.5% compared to the regular souvenir sheets.
3. The postal service should set the selling price for the deluxe souvenir sheet at $15.00
4. The exact number of deluxe sheets is 45.
Calculation of the increase (decrease) in total contribution margin:
The contribution margin is calculated as the selling price minus the variable cost per unit. Given the information, we have:
Selling price of regular souvenir sheets: $8.00
Selling price of deluxe souvenir sheets: $15.00
Number of regular souvenir sheets sold: 80,000
Number of deluxe souvenir sheets sold: 50,000
To calculate the increase (decrease) in total contribution margin, we need to compare the contribution margin of the two scenarios:
Contribution margin regular souvenir sheets = Selling price - Variable cost
= $8.00 - Variable cost
Contribution margin deluxe souvenir sheets = Selling price - Variable cost
= $15.00 - Variable cost
To find the increase (decrease), we'll subtract the contribution margin of regular souvenir sheets from that of deluxe souvenir sheets:
Increase (decrease) in contribution margin = Contribution margin deluxe - Contribution margin regular
= ($15.00 - Variable cost) - ($8.00 - Variable cost)
= $15.00 - $8.00
= $7.00
So, the postal service experienced an increase in total contribution margin of $7.00 when selling 50,000 deluxe souvenir sheets compared to selling 80,000 regular souvenir sheets.
2. Calculation of the percentage increase in selling price and unit sales:
Percentage increase in selling price = [(Selling price deluxe - Selling price regular) / Selling price regular] * 100
= [(15.00 - 8.00) / 8.00] * 100
= 87.5%
Therefore, the St. Vincent post office increased the selling price for the deluxe souvenir sheet by 87.5% compared to the regular souvenir sheets.
Percentage increase in unit sales = [(Unit sales deluxe - Unit sales regular) / Unit sales regular] * 100
= [(50,000 - 80,000) / 80,000] * 100
= -37.5%
The unit sales for the deluxe souvenir sheets decreased by 37.5% compared to the regular souvenir sheets.
3. Calculation of the selling price for the deluxe souvenir sheet to maintain the same total contribution margin per unit:
To maintain the same total contribution margin per unit, the selling price for the deluxe souvenir sheet should be equal to the selling price for the regular souvenir sheet plus the increase in contribution margin per unit:
Selling price deluxe = Selling price regular + Increase in contribution margin
= $8.00 + $7.00
= $15.00
So, the postal service should set the selling price for the deluxe souvenir sheet at $15.00 to maintain the same total contribution margin per unit.
4. Calculation of the number of deluxe souvenir sheets to be sold to equal the total contribution margin earned from selling 80,000 regular souvenir sheets:
Total contribution margin from selling regular souvenir sheets = Contribution margin regular * Number of regular sheets sold
= ($8.00 - Variable cost) * 80,000
To calculate the number of deluxe souvenir sheets to be sold, we'll set the total contribution margin equal to that of regular sheets and solve for the number of deluxe sheets:
Contribution margin deluxe * Number of deluxe sheets = Contribution margin regular * Number of regular sheets
($15.00 - Variable cost) * Number of deluxe sheets = ($8.00 - Variable cost) * 80,000
Simplifying the equation:
Number of deluxe sheets = (Contribution margin regular * Number of regular sheets) / (Contribution margin deluxe)
= ($8.00 - Variable cost) * 80,000 / ($15.00 - Variable cost)
For such more question on margin:
https://brainly.com/question/9797559
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