The model contains dummy variables. O The model omits some important explanatory factors Question 2 2 pts Consider the following regression model y, Po+Pix, +4. If the first four Gauss-Markov assumptions hold true, and the error term contains heteroskedasticity, then O Var(x)=0 O Var(x) = 1 O Var(x)= a O Var(x)=0

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Answer 1

The following are the regression analysis's Gauss-Markov presumptions:

a) The mean of the error term is zero.

b) The variance of the error term is constant.

c) The error term's errors do not vary among observations.

d) Every predictor variable has linear independence from the others.

e) The error term and the predictor variables do not correlate.

f) The variables in a regression model are fixed; they are not variables at random.Therefore, Var(x) = an is the condition under which the first four Gauss-Markov assumptions are satisfied and heteroskedasticity exists in the error component.

This is so because the second Gauss-Markov assumption, which stipulates that the error term has a constant variance, is violated by heteroscedasticity. As a result, Var(x), the variance of the x variable in the provided regression model, is "a."Regression models employ dummy variables to represent categorical factors like gender, race, or educational attainment. A regression model's inclusion of a dummy variable enables the fitting of distinct regression lines for each group. Regression model estimations of the model parameters will be skewed and ineffective if significant explanatory factors are not included.

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Related Questions

Problem 20-36 (Algo) Palin's Muffler Shop has one standard muffler that fits a large variety of cars. The shop wishes to establish a periodic review system to manage inventory of this standard muffler. Use the information in the following table to determine the optimal inventory target level (or order-up-to level). per order Annual demand Standard deviation of daily demand Item cost Annual holding cost Review period 2,850 6 $30.00 40 16 mufflers mufflers per working day per muffler of item value working days Ordering cost Service probability Lead time Working days $ 55 91 4 285 working days per year a. What is the optimal target level (order-up-to level)? (Use Excel's NORMSINV() function to find the correct critical value for the given a-level. Do not round intermediate calculations. Round "z" value to 2 decimal places and final answer to the nearest whole number.) Optimal target level b. If the service probability requirement is 97 percent, the optimal target level will: Increase O Decrease Stay the same

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The appropriate quantities of goods for your brand to keep on hand are known as optimal inventory levels. Since these inventory levels correspond to your actual consumer demand, you always have adequate products to meet that demand. The optimal target level will stay the same.

Given,

The per order, k = 2850

The Annual demand, D = 6

The Standard deviation of daily demand, σ = 40

Item cost, C = $30

The Annual holding cost, h = 16

The Review period, N = 285/16 = 17.8

Therefore, N ≈ 18

The Ordering cost, S = $55

The Service probability, α = 97%

The Lead time, L = 4

Working days, n = 285

The formula to find the optimal target level is given by

OTL = μL + ZσL

Where μL = mean demand during lead time

Z = the critical value of the standard normal distribution for the desired service probabilityσL = standard deviation of demand during lead time

Using the given values

;μL = D × LL = 4n = 285μL = D × L = 6 × 4 = 24σL = σ × √LL = 4√18 = 4.24Z = NORMSINV (α) = NORMSINV (0.97) = 1.8808

Therefore, OTL = μL + ZσLOTL = 24 + 1.8808 × 40 × 4.24OTL = 24 + 318.85OTL ≈ 343.85≈ 344Hence, the optimal target level is 344 mufflers. Therefore, the answer is "Optimal target level".If the service probability requirement is 97 per cent, the optimal target level will stay the same. Therefore, the answer is "Stay the same".

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What is the second certification level?

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The term "second certification level" is quite broad and can apply to various fields and industries. Without specific context, it is challenging to provide a precise answer. However, in many professional certification programs, there are typically multiple levels or tiers of certification.

In general, the second certification level often represents an intermediate or advanced stage of expertise and knowledge within a particular domain. It typically builds upon the foundational concepts covered in the first level and delves deeper into the subject matter.

The second level may involve more complex theories, practical applications, and specialized skills within the field.

For instance, in the IT industry, certifications like Cisco Certified Network Professional (CCNP) or Microsoft Certified Solutions Associate (MCSA) are considered second-level certifications, requiring a solid understanding of the fundamentals demonstrated in their respective first-level certifications.

Ultimately, the specific designation of the second certification level varies across industries and organizations, but it generally signifies a higher level of proficiency and expertise beyond the introductory stage.

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No. 1
Assuming that:
Total cost TC = 500 – 4Q + 1.5Q2
Demand P = 96 – 0.5Q
What is the optimum output to maximize profit? What is the profit level?
Hint: TR = P*Q!
No. 2
Assuming that:
Total cost TC = 500 – 4Q + 1.5Q2
Demand P = 96 – 0.5Q
What is the optimum output to maximize profit? What is the profit level?
Hint: TR = P*Q!
•For a monopoly market, compute P if ED = -1.2; -2.0; -3,0, -5 and -10!
•What is your conclusion!
No. 3
Give a real example of a company or companies having a market power and briefly explain the firm’s elasticity of demand
(hint: based on (i) market demand; (ii) the number of firms; and (iii) the interaction among firms)
No. 4
Using a diagram, briefly explain how a monopsonist determines the price and quantity to maximize its benefit/satisfaction!
Expert Answer

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The optimum output to maximize profit is determined by finding the quantity where marginal revenue (MR) equals marginal cost (MC). The profit level can be calculated by subtracting total cost from total revenue at the optimum output.

For a monopoly market with different values of price elasticity of demand (ED), the corresponding price can be computed using the demand function. The conclusion can be drawn based on the relationship between elasticity and pricing power.

To determine the optimum output to maximize profit, the monopolist must find the quantity where MR equals MC. MR can be calculated as the derivative of total revenue (TR) with respect to quantity (Q), while MC is the derivative of total cost (TC) with respect to quantity. Setting MR equal to MC and solving for Q gives the optimum output. The profit level can then be calculated by subtracting total cost from total revenue at the optimum output.

For a monopoly market with different values of price elasticity of demand (ED), the corresponding price can be computed by substituting the quantity demanded into the demand function. The relationship between elasticity and pricing power is as follows: if ED is greater than 1, the firm has elastic demand and exercises less pricing power; if ED is less than 1, the firm has inelastic demand and exercises more pricing power. The conclusion can be drawn by analyzing the impact of elasticity on the firm's ability to set prices and control the market.

A real example of a company with market power is a tech giant like Apple. Apple's market power is influenced by various factors: (i) its highly popular products generate a significant market demand; (ii) Apple operates as a dominant player with a limited number of competitors in the consumer electronics industry; (iii) the interaction among firms is characterized by Apple's ability to set prices and influence market trends. The elasticity of demand for Apple's products is relatively inelastic due to brand loyalty, limited substitutes, and unique features, allowing the company to exercise pricing power and maintain a strong market position.

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The following unadjusted trial balance is for Wilson Construction Company at its June 30 current fiscal year-end. The credit balance of the Retained Earnings account was $98,000 on June 30 of the prio

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The unadjusted trial balance for Wilson Construction Company shows a credit balance of $98,000 in the Retained Earnings account as of June 30 of the prior year-end.

The unadjusted trial balance is a statement that lists all the accounts and their balances before any adjustments are made. In this case, the trial balance for Wilson Construction Company at its June 30 current fiscal year-end shows that the Retained Earnings account has a credit balance of $98,000. The credit balance in the Retained Earnings account indicates that the company has accumulated net income over previous fiscal periods. Retained Earnings represents the cumulative profits or losses of the company that have been retained and reinvested in the business rather than distributed to shareholders as dividends.The information provided about the credit balance of $98,000 on June 30 of the prior year-end is important for financial analysis and decision-making. It allows stakeholders to assess the profitability and financial health of the company, as well as understand the amount of earnings that have been retained for future growth or distribution as dividends.

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1. [15 marks] The Department of Engineering is contemplating the purchase of a top-of-the- line PCB drilling machine to be used in its laboratories. The price of the machine is $5,000. The depreciatio

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The Department of Engineering is considering the purchase of a PCB drilling machine for its labs that is priced at $5000. The depreciation, salvage value, and useful life of the machine must be calculated before making the purchase.

The cost of the PCB drilling machine is $5,000, according to the Department of Engineering. Before making the purchase, the depreciation, salvage value, and useful life of the machine must be calculated. The cost of the machine is the basis for determining the depreciation expense on an annual basis. The expected useful life and salvage value of the machine are used to determine the depreciation method. Depreciation is a method of allocating the cost of an asset over its useful life. The machine's useful life is estimated at 5 years, which means that the company expects it to be operational for that length of time. The salvage value is also used to determine the depreciation expense, which is the amount the company can expect to receive when the machine is retired. Straight-line depreciation is the most common depreciation method, which divides the asset's cost by its useful life. The depreciation expense is the same every year when using this method. The annual depreciation expense for the PCB drilling machine can be calculated using this method by subtracting the salvage value from the cost and then dividing the result by the useful life.

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Discuss how law is relevant to business using your text and the Internet to:
Identify and discuss at least two fundamental concepts and principles of the American legal system, particularly those pertaining to today’s business environment.
Define ethics and evaluate how the law you have read in the first 2 chapters is based on ethical principles.
Do you feel that corporate ethics, by and large, have worsened in recent years, or is it that these "bad guys" are made more visible by the media. Or is it the magnitude of the ethics violations. Thoughts class as it applies to what you think of ethics and business?

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The American legal system is founded on the principles of the rule of law and contract law, which are fundamental concepts in today's business environment.

The rule of law ensures that businesses and individuals are subject to and must comply with the law, promoting fairness and accountability.

Contract law governs the formation and enforcement of business contracts, establishing the rights and obligations of parties involved. Ethics, defined as a set of moral principles, underlies the law by promoting honesty, fairness, and respect for individual rights. While there may be instances of unethical behavior in business, it is essential for companies to prioritize corporate ethics, implement robust ethics programs, and foster a culture of integrity to uphold ethical principles and contribute to a responsible business environment.

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If I were to receive cash from my sister and I deposited it into my checking account, which of the following changes would occur? a. Both M1 and M2 would decrease. b. Both M1 and M2 would increase. c. M1 would increase; M2 would decrease. d. M1 would decrease; M2 would increase. e. M1 and M2 would remain unchanged.

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If you were to receive cash from your sister and deposited it into your checking account, both M1 and M2 would increase.

M1 includes physical currency in circulation, demand deposits, traveler's checks, and other checkable deposits, which would all increase with the deposit of cash. M2 includes M1 plus savings deposits, money market securities, and other time deposits, which would also increase as the cash deposit is recorded in the banking system. Therefore, the correct answer would be option b: Both M1 and M2 would increase. It's important to note that the increase in M1 and M2 may be temporary if you decide to use the money for a purchase or transfer it to another account, as that would affect the levels of money supply.

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500 words no plagiarism, take your time and make sure you have
the correct answer.

QUESTION 4 (10 marks) Reflect on your experiences as a student in this subject. With reference to relevant organisational behaviour literature, identify and discuss two types of power you exercised during group work and provide an example of each (6 marks). Explain two ways to enhance your power as a student at university (4 marks).

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As an AI language model, I don't have personal experiences or the ability to reflect on them. However, I can provide you with a general response based on relevant organizational behavior literature. Please find below a discussion on two types of power that can be exercised during group work and two ways to enhance power as a student at university:

Expert Power:

Expert power is derived from an individual's knowledge, skills, and expertise in a particular area. When a student possesses specialized knowledge or skills, they can exert expert power within a group. For example, in a group project focused on marketing strategies, a student who has previous experience in digital marketing and demonstrates a deep understanding of the subject matter may be perceived as an expert by other group members. They can use their knowledge and expertise to influence the group's decisions and guide the project's direction.

Referent Power:

Referent power is based on interpersonal attraction and the desire to be associated with a particular individual or group. It arises from qualities such as likability, charisma, and the ability to build strong relationships. In a group setting, a student who possesses referent power is influential because others admire and respect them. For instance, a student who is known for their positive attitude, effective communication skills, and ability to build strong connections with peers can exert referent power. Others may look up to them, seek their opinion, and willingly cooperate with their ideas and suggestions.

Ways to enhance power as a student at university:

Build and Expand Knowledge:

One way to enhance power as a student is to continuously acquire knowledge and develop expertise in specific areas. By actively engaging in coursework, conducting independent research, participating in discussions, and seeking opportunities for learning, students can increase their knowledge base. This increased expertise gives them the potential to exert expert power and influence their peers or group members positively.

Develop Effective Communication and Interpersonal Skills:

Enhancing power as a student also involves developing strong communication and interpersonal skills. Effective communication allows students to express their ideas clearly, actively listen to others, and engage in constructive discussions. By building positive relationships and demonstrating strong interpersonal skills, such as empathy, respect, and collaboration, students can gain referent power within their university community. Others will value their opinions, seek their guidance, and be more willing to work collaboratively with them.

In conclusion, within a group work setting, two types of power that can be exercised by a student are expert power, derived from their knowledge and skills in a specific domain, and referent power, based on interpersonal attraction and the admiration of others. To enhance power as a student at university, it is important to continuously build and expand knowledge in relevant areas and develop effective communication and interpersonal skills. By doing so, students can increase their influence and positively impact their academic and social environments.

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urple Berhad’s production manager is putting together a capital appraisal to replace a machinery in the Batu Maung factory and has sought your advice.
Current machinery
Purchased 4 years ago for RM600,000. Sales proceeds of RM50,000 achievable 5 years from now. If retained, the machinery will require major repairs at the end of the first year amounting to RM50,000, and a further repair of RM20,000 at the end of the third year. Annual cash flows are estimated to be RM30,000. If sold now, it would be for RM70,000.
Proposed replacement
Cost RM900,000 fully installed. Effective life would be for 5 years. Annual maintenance costs would be RM30,000 per year. Cash flows expected to increase to RM60,000 per year.
Additional information Ignore tax effects. Cost of capital is at 10% per annum.
a) Using only Net Present Value as your basis of decision, recommend to the production manager to retain the current machinery, or to replace it. (17 marks)
b) Give TWO criticisms each for the Accounting Rate of Return and Payback Period capital budgeting techniques. (8 marks)

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The Payback Period technique only calculates the time it takes for a project to pay back its initial investment and does not consider the present value of cash flows or future cash inflows beyond the payback period. As a result, the method does not provide an accurate measurement of profitability or profitability.

Using the Net Present Value (NPV) method, it is recommended that Purple Berhad retain its existing machinery instead of purchasing the new one. By estimating the NPV of each machine's cash inflows and outflows at a 10% cost of capital, a decision can be made about which one is a better investment.NPV of existing machinery is as follows:NPV=PV of future cash inflows − PV of future cash outflows
NPV of proposed machinery = RM300,000 − RM1,050,000 = -RM750,000.


ARR does not take into account the time value of money, which may distort the actual return on investment. ARR considers only accounting figures and ignores the effects of inflation, as well as the capital asset pricing model. Criticisms of Payback Period technique

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LEADERSHIP AND SERVANT HOOD IN THE WORKPLACE O discuss the nature and scope of servant leadership in relation to other styles of leadership.

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Servant leadership is a leadership approach that emphasizes the importance of serving others and putting their needs before your own.

What does this  style do?

This style of leadership is often contrasted with more traditional approaches, such as authoritarian or bureaucratic styles, which tend to prioritize the needs of the organization or leader over those of the employees.

Servant leadership focuses on building relationships with employees and empowering them to make decisions and take ownership of their work. This can lead to higher levels of job satisfaction, increased productivity, and a more positive work environment for everyone involved.

In contrast to other styles of leadership, such as autocratic or transformational styles, servant leadership is less focused on the leader's own power or authority and more on the needs of the team. It encourages collaboration and open communication, rather than top-down directives.

By focusing on the needs of others and building a culture of service, servant leaders can create a workplace that is more inclusive, innovative, and successful.

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: A partnership began on January 1, 2020, with
two partners Mary Snow and Scott Lucas. Mary contributed $53,000
cash and Scott contributed equipment with a fair market value of
$33,000. The partners s

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The partnership began on January 1, 2020, with Mary Snow contributing $53,000 cash and Scott Lucas contributing equipment valued at $33,000.

Explanation:

Mary Snow made a cash contribution of $53,000 to the partnership, which increases the partnership's cash assets. Scott Lucas, on the other hand, contributed equipment with a fair market value of $33,000. This contribution adds the equipment to the partnership's assets and increases its overall value. These initial contributions from both partners form the starting capital of the partnership and will be used for the operations and growth of the business.

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Select one company, analyze their Organization Structure.
Explain at every level about role and relevance.

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Let's take Walmart as an example. Walmart is a multinational retail corporation that operates a chain of hypermarkets, grocery stores, and discount department stores.

Here is an overview of Walmart's organization structure:

Board of Directors: The board of directors is responsible for overseeing the company's overall strategy and direction. They are elected by the shareholders and serve as the highest level of management.

CEO (Chief Executive Officer): The CEO is responsible for leading the company's day-to-day operations and implementing the strategies set by the board of directors. The CEO also reports to the board of directors and is the highest-ranking executive in the company.

COO (Chief Operating Officer): The COO is responsible for overseeing the company's day-to-day operations and implementing the strategies set by the CEO. The COO also reports to the CEO and is a key member of the executive leadership team.

CFO (Chief Financial Officer): The CFO is responsible for managing the company's finances, including budgeting, forecasting, and financial reporting. The CFO also reports to the CEO and is a key member of the executive leadership team.

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Gilley, Inc., sells a single product. The company's most recent income statement is given below. Sales (4,000 units) $120,000 Less variable expenses (68,000) Contribution margin 52,000 Less fixed expenses (40,000) Net income $ 12,000 Required: a. Contribution margin per unit is $ ________ per unit b. If sales are doubled to $240,000, total variable costs will equal $ ________ c. If sales are doubled to $240,000, total fixed costs will equal $ ________ d. If 10 more units are sold, profits will increase by $ ________ e. Compute how many units must be sold to break even. # ________ f. Compute how many units must be sold to achieve profits of $20,000. # ________

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Contribution margin per unit is $13 per unit , total variable costs will equal $136,000, total fixed costs will equal $40,000. If 10 more units are sold, profits will increase by $130, The number of units to break-even is 7,111. The number of units required to achieve a profit of $20,000 is 5,538.

Given that Sales (4,000 units) $120,000Less variable expenses (68,000)

Contribution margin 52,000Less fixed expenses (40,000)Net income $ 12,000a)

Calculation of contribution margin per unit

Contribution margin per unit is calculated by dividing the total contribution margin by total number of units.

Contribution margin per unit =$52,000/4,000 units= $13 per unit  

Calculation of total variable costs Total variable cost is calculated as follows:

Contribution margin = Sales - Variable cost ⇒ $52,000 = $120,000 - Variable cost⇒

Variable cost = $120,000 - $52,000 = $68,000

Total variable costs for sales of $240,000 = $240,000 × ($68,000 ÷ $120,000) = $136,000

Calculation of total fixed costs

Total fixed costs for sales of $240,000 = $40,000 (remains the same)

Calculation of profits increase

If 10 more units are sold, profits will increase by $130 = 10 × $13 (contribution margin per unit)

Calculation of break-even point

Break-even point is the point where total sales equals total expenses and the net income is zero.

Contribution margin ratio = Contribution margin / Sales ⇒ $52,000 / $120,000 ⇒ 0.433 or 43.3%

Fixed expenses / Contribution margin ratio = $40,000 / 0.433 ⇒ $92,355 (rounded to nearest dollar)

Total units to break-even = Total fixed cost / Contribution margin per unit ⇒ $92,355 / $13 per unit = 7,111 (rounded to nearest whole unit)

Calculation of the number of units needed to achieve a profit of $20,000

Units required to achieve a profit of $20,000 = (Fixed costs + Operating income) / Contribution

margin per unit = ($40,000 + $20,000) / $13 per unit

= 4,000 units + 1,538 units = 5,538 units (rounded to nearest whole unit)

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what is the wholesaler’s selling price? what is the manufacturer’s selling price?

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The price that manufacturers charge to customers, is referred to as the manufacturers' selling price while wholesale price is the cost of a product as it is sold in bulk to trade or distributors.

In contrast to the price charged to consumers, the wholesale price is the cost of a good when sold in bulk to significant trade or distributor groups. The cost price of a certain product is added to the manufacturer's profit margin to determine the wholesale price. Using wholesale pricing, products are sold for more money than it costs to produce them in order to generate a profit.

The price that manufacturers charge to their clients, which may be wholesalers, retailers, or end users, is referred to as the manufacturers' selling price. It is the cost that a product's manufacturer suggests consumers pay for it at customer-facing retail establishments. Commonly, a manufacturer's selling price is 2.5 to 3 times the wholesale cost.

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CONFIDENTIAL AC/DEC2021/ACC116 PART A IDENTIFY THE FOLLOWING AS TRUE OR FALSE. STATE ONLY ONE ANSWER FOR EACH QUESTION. 1. Work in progress or semi-finished goods include those basic ingredients that

Answers

False.

Work in progress or semi-finished goods generally refer to products that have undergone some level of processing but are not yet completed or ready for sale.

These products are still in the production process and typically require further processing or assembly before they can be considered finished goods.

Basic ingredients, on the other hand, are raw materials that are used to create finished goods. They may not have undergone any level of processing and are not considered work in progress or semi-finished goods.

Examples of basic ingredients include flour, sugar, and oil in the case of a bakery, or steel and aluminum in the case of a manufacturing plant. Therefore, the statement that basic ingredients are included in work in progress or semi-finished goods is false.

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1. In a questionnaire, respondents are asked to enter their hair color. Hair color is an example of a a. categorical variable O b. quantitative variable c. categorical or quantitative variable, depending on how many decimal points d. rationalize variable QUESTION 2 1 points Saved Exhibit 1-2 Out of 3,200 students a researcher found that 1,440, or 45%, like peanut butter. 2. Refer to Exhibit 1-2. A researcher creates a pie chart illustrating that 45% of the 3,200 students like peanut butter. This is an example of a. a sample b. descriptive statistics c. statistical inference d. a population 4. Twenty employees of ABC Corporation were asked if they liked or disliked the new district manager. Below are their responses. Let L represent liked and D represent disliked. L L D L D D D L L D D L D D L D D D D L What is the relative frequency of D/dislike? a. 0.4 b. 0.6 c. 1.0 d. 50% QUESTION 5 5. The population variance is an example of a O a. population parameter b. sample statistic c. population sample d. mode 8. The assembly time for a product is uniformly distributed between 6 to 10 minutes. The probability of assembling the product in 8 minutes or less is a. 0.25 b. 0.75 O c. 0.5 O d. 1.5 QUESTION 9 9. X is a normally distributed random variable with a mean of 7 and a standard deviation of 4. The probability that x is less than 2 is a. 0.87 b. 0.11 c. 0.72 O d. 0.98 12. A simple random sample of 100 observations was taken from a very large population. The population standard deviation is 120. The standard error of the mean is a. 1.875 b. 40 c. 12 O d. 2 QUESTION 13 13. A theorem that allows us to use the normal probability distribution to approximate the sampling distribution of sample means and sample proportions whenever the sample size is large is known as the a. approximation theorem b. normal probability theorem Ο Ο Ο Ο c. central limit theorem d. central normality theorem

Answers

Hair color is an example of a categorical variable because it represents distinct categories or groups. Hair color is not measured on a numerical scale but rather classified into categories such as blond, brunette, red, etc.

Creating a pie chart to illustrate the percentage of students who like peanut butter out of a total of 3,200 is an example of descriptive statistics. Descriptive statistics involve summarizing and presenting data in a meaningful way, such as through charts or graphs, to provide an overview or description of the data.

The relative frequency of D/dislike in the given employee responses is 0.6 or 60%. Relative frequency is calculated by dividing the frequency of a particular category (in this case, the number of dislikes) by the total number of responses.

The population variance is an example of a population parameter. Population parameters describe characteristics or properties of an entire population, such as mean, variance, or standard deviation, based on complete data from the population.

The probability of assembling the product in 8 minutes or less, given a uniform distribution between 6 to 10 minutes, is 0.75 or 75%. This can be calculated by determining the proportion of the total range that falls within the desired time frame.

The probability that the random variable X, which follows a normal distribution with a mean of 7 and a standard deviation of 4, is less than 2 is 0.11 or 11%. This can be determined by calculating the area under the normal distribution curve to the left of the value 2.

The standard error of the mean, given a sample size of 100 and a population standard deviation of 120, is 12. Standard error measures the variability or dispersion of sample means around the true population mean and is calculated by dividing the population standard deviation by the square root of the sample size.

The theorem that allows us to use the normal probability distribution to approximate the sampling distribution of sample means and sample proportions when the sample size is large is known as the central limit theorem. The central limit theorem states that, regardless of the shape of the population distribution, the sampling distribution of the mean approaches a normal distribution as the sample size increases.

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Linkconin expects an Earrings aftor Taxes of 7500005 every year. The Sem catently has 100% Equity and cast of raising equally is 12% # the company can borow dete with will be the value of the company if the company takes on a debt equal to 60% of to undevered value? What will be the value of the company if the company takes on a debt aal to 50% of value? Assume the company's fax rate is 30% (Must show the steps of calculation)

Answers

To calculate the value of the company when taking on debt, we need to use the adjusted present value (APV) approach, which considers the tax shield benefits of debt. Here are the calculations:

1. Debt equal to 60% of the unlevered value:
  Value of debt = 60% of unlevered value = 0.6 * Earnings after Taxes = 0.6 * $7,500,005 = $4,500,003
  Value of equity = Earnings after Taxes - Value of debt = $7,500,005 - $4,500,003 = $3,000,002
  Value of the company = Value of equity + Value of debt = $3,000,002 + $4,500,003 = $7,500,005
2. Debt equal to 50% of the value:
  Value of debt = 50% of value = 0.5 * Earnings after Taxes = 0.5 * $7,500,005 = $3,750,002.5
  Value of equity = Earnings after Taxes - Value of debt = $7,500,005 - $3,750,002.5 = $3,750,002.5
  Value of the company = Value of equity + Value of debt = $3,750,002.5 + $3,750,002.5 = $7,500,005
Therefore, the value of the company when taking on debt equal to 60% of the unlevered value would be $7,500,005, and when taking on debt equal to 50% of the value, it would also be $7,500,005.

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Problem 33-7 (IAA) High Company purchased for cash at P50 per share all 150,000 ordinary shares outstanding of another entity. The statement of financial position of the acquiree on the date of acquisition showed net assets with a carrying amount of P6,000,000. The fair value of property, plant, and equipment on same date was P800,000 in excess of carrying amount. What amount should be recorded as goodwill on the date o purchase? a. 1,500,000 b. 800,000 C. 700,000 d. 0

Answers

Goodwill should be recorded at P700,000 on the date of purchase. Goodwill is the excess of the purchase price over the fair value of the net identifiable assets acquired.

In this case, High Company purchased all 150,000 ordinary shares of the acquiree for cash at P50 per share, resulting in a total purchase price of P7,500,000 (150,000 shares x P50 per share). The statement of financial position of the acquiree on the date of acquisition showed net assets with a carrying amount of P6,000,000. Additionally, the fair value of property, plant, and equipment was P800,000 in excess of the carrying amount.

To calculate the amount of goodwill, we need to determine the fair value of the net identifiable assets acquired. The fair value of the net identifiable assets can be calculated as follows:

Net assets carrying amount + Fair value adjustment = Fair value of net identifiable assets

P6,000,000 + P800,000 = P6,800,000

Next, we subtract the fair value of net identifiable assets from the purchase price:

Purchase price - Fair value of net identifiable assets = Goodwill

P7,500,000 - P6,800,000 = P700,000

Therefore, the amount recorded as goodwill on the date of purchase is P700,000.

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Target Market and Positioning of starbucks : Analyze the target segment for the company’s product, providing a full analysis of its demographic, psychographic, geographic, and behavioral characteristics. Define the company/product’s position relative to competitors? include resourses.

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Target Market and Positioning of Starbucks Target Market Analysis Starbucks is a global corporation that provides coffee beverages, snacks, and other items to people of all ages. As a result, the company's target market is a diverse one, ranging from young adults to senior citizens.

However, the company primarily targets middle-aged people aged 25 to 45 who are high earners, both male and female, and those who are more affluent. It is these people that make up the majority of the company's consumer base.Starbucks also targets customers who appreciate the company's coffee and the culture that surrounds it. They also put a premium on high-quality coffee, and they're willing to pay a premium for it, which is where Starbucks comes in. This specific market demographic enjoys a quiet place to work, read, or socialize while enjoying a cup of coffee. The company also provides free internet, music, and additional perks to consumers, making them feel welcome and at ease while inside the store.

According to a recent survey, the company's primary target audience comprises individuals who earn more than $60,000 annually and have a college degree. Starbucks stores are primarily located in urban areas, as well as high-traffic areas such as malls, universities, and airports. The company also has a mobile app that allows consumers to order ahead and skip the line, which appeals to their core demographic. Starbucks has maintained its strong brand image by continuing to provide a premium product to its consumers, resulting in the company becoming synonymous with quality coffee and customer experience. Positioning Analysis The following are some of the company's key competitors in the coffee industry: Dunkin' Donuts, McDonald's, and Costa Coffee, among others. Starbucks' brand position is unique, as the company offers high-quality coffee that is not found in other fast-food chains. Starbucks is more than simply a coffee shop; it is a "third place" where people may come to work, read, or socialize in a welcoming and calm atmosphere. Starbucks also caters to customers who value quality over quantity, which distinguishes them from other competitors who sell more affordable, low-quality coffee products. Starbucks uses high-quality beans from various regions worldwide and uses skilled baristas to create their delicious coffee beverages. The company provides its customers with a unique experience, and it is their culture that draws customers in. Starbucks has established a strong brand image over the years, which is synonymous with quality coffee and exceptional customer experience. Starbucks' social responsibility efforts have also helped to differentiate it from other competitors.

The company is dedicated to creating a sustainable environment for future generations by reducing waste, conserving energy, and encouraging ethical sourcing of its products. Starbucks has effectively positioned itself in the market as a premium brand that provides high-quality coffee beverages and exceptional customer experience, distinguishing itself from other low-quality coffee chains.

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Jabari is planning for his retirement in 5 years’ time. He plans to deposit $200,000 immediately into an investment plan that promises 11% annually. He will deposit $30,000 and the end of each of the next five years. i. What will be the value of the investment when Jabari retires in 5 years?.

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To calculate the value of the investment when Jabari retires in 5 years, we need to consider the initial deposit and the subsequent annual deposits, along with the annual interest rate.

Initial deposit = $200,000

Annual deposit = $30,000

Number of years = 5

Annual interest rate = 11%

To calculate the future value of the investment, we can use the future value of an ordinary annuity formula:

Future value = Initial deposit * (1 + interest rate)^n + Annual deposit * [(1 + interest rate)^n - 1] / interest rate

Where:

n = Number of years

Substituting the values into the formula:

Future value = $200,000 * (1 + 0.11)^5 + $30,000 * [(1 + 0.11)^5 - 1] / 0.11

Calculating the expression:

Future value = $200,000 * 1.73205 + $30,000 * (1.73205 - 1) / 0.11

Future value = $346,410 + $90,909.09

Future value = $437,319.09

Therefore, the value of the investment when Jabari retires in 5 years will be approximately $437,319.09.

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Maria Stanley is an energetic, 25-year-old IT professional who
designs software packages for small
businesses. As a self-employed entrepreneur in a volatile market,
Maria’s income is highly erratic.

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Maria Stanley is a self-employed entrepreneur who is 25 years old and is an energetic IT professional. Maria Stanley is a self-employed, energetic entrepreneur who is known for designing software packages for small businesses. Her software is cost-effective, efficient, and meets the specific needs of small businesses. Although her income is highly erratic due to the volatile market, she remains focused and determined to succeed.

She is known for designing software packages for small businesses. Her income is highly erratic due to the volatile market. She has to face the fluctuations in the market on a daily basis.Maria Stanley is a person who is very talented and highly energetic. She has great potential and has made a name for herself in the market. Maria Stanley's software packages have become very popular among small businesses. She designs her software in such a way that it meets the specific needs of small businesses. Maria's software packages are cost-effective and very efficient. They help small businesses to manage their day-to-day activities in a more organized and streamlined way.Maria Stanley's job is challenging as a self-employed entrepreneur. However, she is very focused and determined. She keeps herself updated with the latest trends in the market and uses her skills to design software packages that are in demand. She manages to generate a decent income for herself, but it is highly erratic as the market is volatile.  Maria Stanley is a self-employed, energetic entrepreneur who is known for designing software packages for small businesses. Her software is cost-effective, efficient, and meets the specific needs of small businesses. Although her income is highly erratic due to the volatile market, she remains focused and determined to succeed.

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(a) What proportion of the world's primary energy supply comes from natural gas? (b) Globally, which two countries are producing the largest quantities of natural gas? (c) From which two countries does Europe get most of its natural gas?

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(a) As of my knowledge cutoff in September 2021, approximately 23% of the world's primary energy supply comes from natural gas.

(b) The two countries that were globally producing the largest quantities of natural gas as of my knowledge cutoff in September 2021 were the United States and Russia.

please note that rankings and production levels can change over time due to various factors such as exploration, new discoveries, and technological advancements.

(c) As of my knowledge cutoff in September 2021, the two countries from which Europe gets most of its natural gas are Russia and Norway. These countries are major suppliers of natural gas to European countries through pipelines and liquefied natural gas (LNG) shipments. However, specific import patterns and sources may vary over time as countries diversify their energy supplies and establish new trade agreements.

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With the advent of e-commerce, customers are buying in ways they have never done before. The ubiquity of mobile devices also makes it possible for mobile commerce to be carried out from anywhere and a

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The rise of e-commerce and the widespread use of mobile devices have revolutionized the way customers engage in buying and selling activities.

The advent of e-commerce has fundamentally changed the shopping habits of consumers. With the click of a button, customers can browse and purchase products from the comfort of their own homes, eliminating the need to visit physical stores.

The ubiquity of mobile devices has also facilitated the integration of online and offline experiences through features like mobile payment options, personalized recommendations, and real-time notifications. This seamless integration has created a more convenient and efficient shopping experience for customers.

Furthermore, the global reach of e-commerce and mobile commerce has expanded market opportunities for businesses. Companies can now reach a wider customer base beyond their local markets and tap into the global marketplace.

Overall, the advent of e-commerce and mobile commerce has transformed the retail industry, empowering customers with unprecedented convenience and opening up new avenues for businesses to engage with their target audience.

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How would you show the impact of higher gas prices on the market for electric cars?

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The market for electric cars is one that is sensitive to higher gas prices. As gas prices continue to rise, people are turning to electric cars as a means of reducing the amount of money they spend on fuel.

Additionally, higher gas prices have a direct impact on the market for electric cars because they make it more difficult for people to afford traditional gas-powered vehicles, thereby making electric cars more attractive.

How would you show the impact of higher gas prices on the market for electric cars? The demand for electric cars would likely increase as a result of higher gas prices. This is because people who are looking to save money on fuel costs will be more likely to purchase an electric car, which is generally cheaper to operate than a traditional gas-powered car. In addition to this, higher gas prices would likely cause people to trade in their gas-powered cars for electric cars, which would also increase the demand for these vehicles. A second way to show the impact of higher gas prices on the market for electric cars would be to look at the sales figures for these vehicles. As gas prices rise, the number of electric cars sold would likely increase, as people look to save money on fuel costs. This would lead to an increase in the overall market share of electric cars.

Finally, you could look at the growth rate of the market for electric cars over time. As gas prices continue to rise, it is likely that the market for electric cars will continue to grow at an accelerated rate, as more and more people turn to these vehicles as a means of saving money on fuel costs.

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Why shouldn’t every adult without a job be classified as part of
the official unemployment rate? What are some problems with using
the unemployment rate as an accurate measure of
joblessness? Why

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Not every adult without a job is classified as part of the official unemployment rate for several reasons:

Not actively seeking employment: To be classified as unemployed, individuals need to be actively seeking employment. If someone is not actively looking for work or has given up searching, they may not be counted in the official unemployment rate. This can result in an underestimation of joblessness.

Discouraged workers: Some individuals may become discouraged and stop actively looking for work due to factors such as long-term unemployment or lack of available job opportunities. These discouraged workers are not considered part of the labor force and, therefore, are not included in the official unemployment rate.

Underemployment: The official unemployment rate does not account for individuals who are working part-time but desire full-time employment. These individuals may be counted as employed but are still experiencing underemployment and not fully utilizing their skills and capabilities.

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Blossom Company has the following two notes receivable at May 31, 2021, its fiscal year end: 1. $30,000 six-month, 4% note issued January 1, 2021 2. $9,600 three-month, 4% note issued April 30, 2021 I

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Accrual basis accounting is a method that records revenue and expenses when they are incurred, regardless of whether cash has been received or paid. Blossom Company should record interest revenue for both notes. The interest for the first note is $600, while for the second note, it is $128.

Blossom Company should record interest revenue for both notes. The interest for the first note is $600, calculated as follows:($30,000 x 4% x 6/12) = $600The second note has an interest of $128, calculated as follows:($9,600 x 4% x 3/12) = $128The revenue should be recognized at the end of the month or the year, depending on the company's accounting cycle. Blossom Company uses the accrual basis accounting method, which records revenue and expenses when they are incurred, regardless of whether cash has been received or paid. For the first note, Blossom Company should recognize $600 of interest revenue on June 30, 2021 (six months from the issuance date). For the second note, it should recognize $128 of interest revenue on July 31, 2021 (three months from the issuance date).

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Which would cause both an increase in the price of tuna
and a decrease in the amount of tuna sold?
A. An increase in the supply of tuna
B. An increase in the price of the labor used to produce
canned

Answers

An increase in the price of the labor used to produce canned tuna would cause both an increase in the price of tuna and a decrease in the amount of tuna sold.

When the price of labor used in the production of canned tuna rises, it increases the production costs for tuna canneries. As a result, the cost of producing canned tuna increases, leading to higher prices for the end consumers. This increase in price can deter some buyers from purchasing tuna, thereby decreasing the quantity of tuna sold.

The relationship between the price of labor and the price of goods produced is influenced by the concept of supply and demand. In this scenario, an increase in labor costs affects the supply side of the tuna market, leading to a decrease in supply and an increase in price. The decrease in quantity sold occurs as a result of the higher price, which affects consumer demand.

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The following matrix shows the pricing strategy and payoff of Firm X and Firm Y in a duopoly. Firm X-Normal Price Firm X-Offer Discount Firm Y- Normal Price Payoff of Firm X - 5 Payoff of Firm X 4 Payoff of Firm Y-6 Payoff of Firm Y = 12 Firm Y-Offer Discount Payoff of Firm X - 11 Payoff of Firm X-9 Payoff of Firm Y-3 Payoff of Firm Y = 10 Identify the Nash equilibrium and best total outcome in the matrix. Explain why best total outcome is unlikely to be achieved.

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Nash equilibrium: It is a concept in game theory where the two players are in a state where neither player wants to change their strategy without causing their payoff to decrease. The Nash equilibrium is one of the central solution concepts in game theory.

In game theory, the Nash equilibrium is reached when two or more players have no incentive to change their behavior, given the behavior of the other player(s). Best total outcome: It occurs when both firms set discount prices as follows: Firm X Offer Discount Firm Y Offer Discount In this situation, the payoff of both firms will be 7, which is the best outcome that can be achieved. Explanation: The Nash equilibrium is reached when both firms set discount prices. The Nash equilibrium is a situation where neither player can improve their payoff by changing their strategy. In this case, the Nash equilibrium is reached when Firm X offers a discount and Firm Y charges a normal price. The best total outcome, which occurs when both firms set discount prices, is unlikely to be achieved because neither firm has an incentive to offer a discount. If Firm X offers a discount and Firm Y charges a normal price, Firm X will get a higher payoff, but Firm Y will get a lower payoff. If Firm Y offers a discount and Firm X charges a normal price, Firm Y will get a higher payoff, but Firm X will get a lower payoff. Therefore, the best total outcome is unlikely to be achieved because both firms have an incentive to charge a normal price, which results in a lower payoff for both firms compared to when both firms set discount prices.

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Which organizational pattern would be appropriate for each of these topics? • Why most fatal car accidents occur Three types of working dogs • How to gift wrap a present • Stalking--and what can be done to stop it A giant redwood tree

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Organizational patterns are an important aspect of writing. The organizational pattern used in a piece of writing helps readers understand the relationships between ideas, and it helps the author present information in a clear and logical way. Here are the appropriate organizational patterns for each of these topics:


Why most fatal car accidents occur

The most appropriate organizational pattern for this topic is cause and effect. This is because it involves the identification of the reasons (causes) behind the occurrence of the car accidents, and their effects (the fatalities). The writer should discuss the causes first and then move on to discuss the effects.


Three types of working dogs

The most appropriate organizational pattern for this topic is classification. This is because the writer has to classify the dogs into different types and describe each type in detail. The writer should start by discussing the general traits of working dogs, then classify the three types and describe each type in detail.


A giant redwood tree

The most appropriate organizational pattern for this topic is description. This is because the writer has to describe the giant redwood tree in detail. The writer should use descriptive language to paint a clear picture of the tree, its physical characteristics, and its environment.

In conclusion, the appropriate organizational patterns for these topics are cause and effect, classification, step-by-step process, problem and solution, and description.

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Strategy evaluation is necessary for all sizes and kinds of organizations. Strategy evaluation should initiate managerial questioning of expectations and assumptions, should trigger a review of objectives and values, and should stimulate creativity in generating alternatives and formulating criteria of evaluation. Regardless of the size of the organization, a certain amount of management by wandering around at all levels is essential to effective strategy evaluation. Strategy-evaluation activities should be performed on a continuing basis, rather than at the end of specified periods of time or just after problems occur. Waiting until the end of the year, for example, could result in a firm closing the barn door after the horses have already escaped.

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Strategy evaluation is necessary for all sizes and kinds of organizations. It is a systematic process of examining the firm's present strategy, evaluating it, and making decisions about the future course of action. Strategy evaluation is a crucial process that all organizations must undertake to ensure their strategies are effective, efficient, and up to date.

Strategic management implies evaluating an organization's strategies to determine if they are working effectively and how they can be improved.
The process of strategy evaluation has several benefits to an organization. Firstly, it initiates managerial questioning of expectations and assumptions, thus allowing the organization to respond quickly and effectively to changes in the environment. Secondly, strategy evaluation triggers a review of objectives and values, ensuring that they remain relevant and in line with the organization's mission. Lastly, it stimulates creativity in generating alternatives and formulating criteria of evaluation.
Regardless of the size of the organization, a certain amount of management by wandering around at all levels is essential to effective strategy evaluation. Management by wandering around is a technique where managers interact with employees at all levels of the organization to observe and gain insights into the company's activities, issues, and challenges. This process enables managers to identify potential problems and opportunities and respond accordingly.
Strategy-evaluation activities should be performed on a continuing basis, rather than at the end of specified periods of time or just after problems occur. Waiting until the end of the year, for example, could result in a firm closing the barn door after the horses have already escaped. By conducting continuous strategy evaluations, organizations can stay ahead of the competition, mitigate risks, and capitalize on new opportunities.

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Other Questions
Use mathematical induction to show that n! 2n-1 for all n 1 8.1.14 (Binocular rivalry) Normally when you look at something, your left and right eyes see images that are very similar. (Try closing one eye, then the other; the resulting views look almost the same, except for the disparity caused by the spacing between your eyes.) But what would happen if two completely different images were shown to your left and right eyes simultaneously? What would you see? A combination of both images? Experiments like this have been performed for hundreds of years (Wade 1996), and the results are amazing: your brain typically perceives one image for a few seconds, then the other, then the first again, and so on. This switching phenomenon is known as binocular rivalry. Mathematical models of binocular rivalry often posit that there are two neu- ral populations corresponding to the brain's representations of the two competing images. These populations battle with each other for dominance each tends to suppress the other. The following exercise, kindly suggested by Bard Ermentrout, involves the analysis of a minimal model for such neuronal competition. Let X and X denote the averaged firing rates (essentially, the activity levels) of the two populations of neurons. Assumex =x +F(I bx), x =x + F(I bx), where the gain function is given by F(x)=1/(1+e*), I is the strength of the input stimulus (in this case, the stimuli are the images; note that each is assumed to be equally potent), and b is the strength of the mutual antagonism. a) Sketch the phase plane for various values of I and b (both positive). b) Show that the symmetric fixed point, x * = x * = x*, is always a solution (in other words, it exists for all positive values of I and b), and show that it is unique. c) Show that at a sufficiently large value of b, the symmetric solution loses stability at a pitchfork bifurcation. Which type of pitchfork bifurcation is it? The polynomial C (x) = 6r + 90x gives the cost, in dollars, of producing a rectangular container whose top and bottom are squares with side x feet and height 4 feet. Find the cost of producing a box with side x=6 feet. Type in only a number as your answer below. The income statement for the month of June of Camera Obscura Enterprises contains the following information: Sales Revenues $7,000 Expenses:Salaries and Wages Expense $3,000 Rent Expense 1,500 Advertising Expense 800 Supplies Expense 300 Insurance Expense 100 Total expenses 5.700 Net income $1.300 After the revenue and expense accounts have been closed, the balance in Income Summary will be a. a credit balance of $7,000. b. $0. c. a debit balance of $1,300. d. a credit balance of $1,300. Let u = i + j + k and u x v = j - k. Find a unit vector parallel to vector v which is correct to solve 1-Finding u(u xv) 2-v = xi + yj + zk and solve the system to find x, y, z Assuming that the equations in define x and y implicitly as differentiable functions x = f(t), y = g(t) find the slope of the curve x = f(x), y = g(t) at the given value of t. (i) x + 2x3/ = 1 +t, yt+1+2ty = 4, t= 0. (ii) x sin t + 2x=t, t sin t - 2t=y, t = (iii) t = ln (xt), y = te', t = 1. Name two factors that determine what type of health care system acountry/society adopts as its own. Identify the four basic strategic approaches that MNCs use forplanning and updating their operations. From the following details find out the credit purchases and total purchases: Cash purchases Opening balance of bills payable Opening balance of Creditors Opening balance of bills payable Closing balance of Creditors Cash paid to Creditors Bills payable paid during the year Purchases Returns Allowance from Creditors Bills payable dishonoured 1. Find the area below the curve y = x(3-x) and above the curve y = -2x from x = 0 to x = 3. 2. 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Choose the correct answer below A. necessary to assume that the populations from which you are sampling have negative Igrar test statistics and unequal sample means B. necessary to assume that the populations from which you are sampling have equal population means and positive standard deviations C. ct is necessary to assume that the populations from which you are sampling have unequal variances and equat sis D. necessary to assume that the populations from which you are sampling have independent normal distributions and equal variances Which of the following must be displayed prominently in a headquarters, satellite office of the establishing agent or broker, by the supervising person(s) responsible for that place of business? A. Certificate of occupancy B. College DegreeC. License of supervising person D. Professional affiliates Required January February Beginning inventory 0 300 300 Production 1,000 800 1,250 Sales 700 800 1,500 Variable costs 900 900 $ 900 Manufacturing cost per unit produced Operating (marketing) cost per unit sold Fixed costs $ 600 $ 600 $ 600 $400,000 $400,000 $400,000 Manufacturing costs Operating (marketing) costs $140,000 $140,000 $140,000 The selling price per unit is $2,500. The budgeted level of production used to calculate the budgeted fixed manufacturing cost per unit is 1,000 units. There are no price, efficiency, or spending variances. Any production-volume variance is written off to cost of goods sold in the month in which it occurs. 1. Prepare income statements for BigScreen in January, February, and March of 2012 under (a) variable costing and (b) absorption costing Today the one year forward rate for the Swiss franc is SF11505/$. The spot rate is SF11626/$. The interest rate on a risk-free asset in Switzerland is 271 percent if interest rate parity exists, what is the one-year risk-free rate in the US? Multiple Choice A. 164% B. 3,03% C. 355% D. 3.79% E. 332% Using ABC analysis, which of these should be classified as A item/s based "Annual Usage Cost"? Unit Cost (S) Item A-101 Annual Usage (pcs) Remarks 100,000 A-106 50,000 Only 1 source (in Tibet) A-112 200 A-115 10,000 Will be replaced with new part in 2 months A-119 500 A-122 1,000 A-125 60,000 A-130 1,000 1.50 200.00 100.00 2.00 8.00 19.00 3.00 10.00 Let's say you are playing the stock market and below period 2020 data was provided. For "stock A" you use a 2 month moving average. For "stock B" you use exponential smoothing with (a = 0.3). What is the Forecast in Stock B for January 2021? Stock A Stock B Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 0.11 0.20 0.03 1.20 0.50 0.03 0.10 0.11 0.56 0.78 0.44 0.10 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 14 8 6 9 12 16 14 8 6 4 4 Let's say you are playing the stock market and below period 2020 data was provided. For "stock A" you use a 2 month moving average. For "stock B" you use exponential smoothing with (a = 0.3). What is the Forecast in Stock A for January 2021? Stock B Stock A Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 0.11 0.20 0.03 1.20 0.50 0.03 0.10 0.11 0.56 0.78 0.44 0.10 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 14 8 6 9 12 16 14 8 6 4 14 Let g(x)=3x. a. Find g-. b. Use (g-)'(x) = 1/g'(g-(x)) to compute (g-)'(x). Please answer the following questions in no more than 500 words based on the following posed Microeconomic concept: There is an innovative and more effective new drug on the market that manages high blood pressure. The drug manufacturer has applied for and received a patent.Describe the different type of costs to produce the drug. Categorize the costs by fixed and variable, and then indicate/describe the profit-maximizing condition.What happens in the market for other high blood pressure drugs, that are not as effective? Consider which curve shifts and the corresponding change in equilibrium price and quantity.Compare the equilibrium price and quantity for the drug under the patent conditions relative to if the market were opened to perfectly competitive forces. Explain the main characteristics of each market structure.Why would you or would you not allow this new drug to be available through a patent?In answering these questions, the student should be able to:Demonstrate the knowledge of basic elements and concepts of microeconomics.Identify economic resources and their use.Differentiate production under pure competition, and monopoly but no errors in economic reasoning.