Answer:
The answer is -1.5 and complementary goods
Explanation:
Cross price elasticity is the percentage decrease in quantity demanded divided percentage increase in price.
= -6/4
= - 1.5.
Because the sign is negative, the goods are complements. Complementary goods are directly related. As in they move in the same direction.
For example, car and fuel are complements. The increase in quantity demanded for car will increase the quantity demanded for fuel. Or if the price of car goes up, all things being equal, the quantity demanded of car will reduce and for fuel too.
Kaelyn's mother, Judy, looks after Kaelyn's four-year-old twins so Kaelyn can go to work (she drops off and picks up the twins from Judy's home every day). Since Judy is a relative, Kaelyn made sure, for tax purposes, to pay her mother the going rate for child care ($6,460 for the year). What is the amount of Kaelyn's child and dependent care credit if her AGI for the year was $37,600
Answer:
Kaelyn's child and dependent care credit is:
$2,100.
Explanation:
a) Data and Calculations:
Going rate for child care for twins = $6,460
Maximum allowed = $6,000
Kaelyn's AGI for the year = $37,600
Percentage of child and dependent care credit = 35% of the allowed maximum for two children
b) The maximum qualified child and dependent care expense is $6,000 ($3,000 each) that Kaelyn can claim for the twins. Therefore, her child and dependent care credit is 35% of $6,000, which equals $2,100.
Hull Company reported the following income statement information for the current year: Sales $ 413,000 Cost of goods sold: Beginning inventory $ 136,500 Cost of goods purchased 276,000 Cost of goods available for sale 412,500 Ending inventory 147,000 Cost of goods sold 265,500 Gross profit $ 147,500 The beginning inventory balance is correct. However, the ending inventory figure was overstated by $23,000. Given this information, the correct gross profit would be:
Answer: $124,500
Explanation:
If Ending Inventory was overstated by $23,000, this means that Cost of Goods was understated by $23,000.
Actual Cost of Goods sold = 265,500 + 23,000
= $288,500
Gross profit = Sales - Cost of goods
= 413,000 - 288,000
= $124,500
Jacobs Company has warrants outstanding, which are selling at a $3.00 premium above intrinsic value. Each warrant allows its owner to purchase one share of common stock at $26. If the common stock currently sells for $30, what is the warrant price? (Round your answer to 2 decimal places.) $11.00 $7.00 $8.00 $10.00
Answer: $7.00
Explanation:
Based on the information provided in the question, the warrant price would be calculated as the addition of the premium which is above the intrinsic value and the paid in excess of the common stock. This will be:
= $3 + ($30 - $26)
= $3 + $4
= $7.00
A pizza monopolist employing third-degree price discrimination charges students $10 per pizza and everyone else $15 per pizza Students must show the ID before they can get the discount The marginal cost of this monopolist is $5 whether or not the customer is a student. The price elasticity of demand for the students is
Answer:
The price elasticity of demand for the students is:
inelastic.
Explanation:
The price elasticity of demand for the students is inelastic because there is no change in the quantity demanded by students that changes the price at which pizza is sold to the students. If one student buys the pizza, the price charged remains $10 and if 1,000 students buy the pizza, the price remains $10 per unit. Therefore, students' demand for the pizza is said to be static irrespective of price because the price is fixed.