BUSINESS COLLEGE

A labor contract provides for a first-year wage of $15 per hour, and specifies that the real wage will rise by 2 percent in the second year of the contract and by another 2 percent in the third year. The CPI is 1.00 in the first year, 1.09 in the second year, and 1.15 in the third year. What dollar wage must be paid in the third year

Answers

Answer 1

Answer:

The dollar wage to be paid in the third year based on the labor contract is $17.95 per hour.

Data and Calculations:

First-year wage per hour = $15

Increase in real wage in the second year = 2%

Increase in real wage in the third year = 2%

First year's CPI = 1.00

Second year's CPI = 1.09

Third year's CPI = 1.15

What is CPI?

The Consumer Price Index (CPI) measures the weighted average prices of a basket of consumer goods and services in the United States, considering its general economic inflation. The labor contract raises the real wage by 2% in the second and third years. The CPI of year three is applied in computing the real wage to account for the effect of inflation.

Thus, the dollar wage that must be paid in the third year based on the labor contract is $17.95 per hour ($15 x 1.02 x 1.02 x 1.15).

Learn more about the CPI, inflation, and the real wage at brainly.com/question/24802187

Answer 2

Answer:

$17.9469

Explanation:

Calculation for what dollar wage must be paid in the third year

Since the first year is tend to be the base year in which the real wage and nominal wage are both $15 per hour in that year.

The real wage is suppose to increase by 2 percent in the second year which means that the real wage in year two will be $15.30 ($15 * 1.02) per hour.

In a situation where the real wage was supposed to also increase by 2 percent in the third year, this means that the real wage in year three will be $15.606 ($15.3 * 1.02) per hour.

Therefore In order for us to find the nominal wage in third year , we have to index the real wage in order for it to adjust for inflation. Thus the nominal wage in third year will be $17.9469($15.606 * 1.15).

Therefore what dollar wage must be paid in the third year will be $17.9469

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Investing in stocks is like gambling when:a. both have a short time horizon

b. both involve risk

c. both involve an initial outflow of cash

d. both result in long-term loses.

Answers

If so maybe see hope help

Novak Imports is a merchandising Firm. Last year they reported sales of $677000 and cost of goods sold of $405100. The company's total variable selling and administrative expense was $60750, and fixed selling and administrative expense was $54350. The total contribution margin for the firm is:

Answers

Answer:

Contribution margin = $211,150

Contribution margin ratio = 31.19%

Explanation:

total sales revenue $677,000

variable costs:

Cost of goods sold $405,100
S&A expenses $60,750 ($465,850)

Contribution margin $211,150

Fixed expenses ($54,350)

Operating income $156,800

Contribution margin ratio = $211,150 / $677,000 = 31.19%

A project with an initial cost of $51,400 is expected to generate annual cash flows of $16,910 for the next 5 years. What is the project's internal rate of return

Answers

Answer:

19.27%

Explanation:

Internal rate of return is the discount rate that equates the after tax cash flows from an investment to the amount invested

IRR can be calculated with a financial calculator

Cash flow in year 0 = $-51,400

Cash flow each year from year 1 to 5 = $16,910

IRR = 19.27%

To find the IRR using a financial calculator:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. After inputting all the cash flows, press the IRR button and then press the compute button.

Which of the following assumptions is likely to be met in the real world? Group of answer choices All labor has zero costs of mobility. Demand for labor is identical in every labor market. All labor is homogeneous. Nonpecuniary factors in each job are not the same.

Answers

Answer:

None of the above

Explanation:

NONE of of the following assumptions is likely to be met in the real world.

Assumptions which include

A) All labor has zero costs of mobility. B) Demand for labor is identical in every labor market. C) All labor is homogeneous. D) Non pecuniary factors in each job are not the same are NOT likely to be met in the real word

The following assets in Jack’s business were sold in 2020: Asset Holding Period Gain/(Loss) Office equipment 6 years $1,100 Automobile 8 months ($ 800) ABC stock (capital asset) 2 years $1,400 Office equipment, purchased for $8,000, had a zero adjusted basis. The automobile was purchased for $2,000 and sold for $1,200. The ABC stock was purchased for $1,800 and sold for $3,200. In 2020 (the year of sale), Jack should report what amount of net capital gain and net ordinary income?

Answers

Answer:

Net capital gain = $1,400

Net ordinary income = $300

Explanation:

Long term Capital gain = $1,400 from sale of stock since it was hold for 2 years (more than 1 year)

Ordinary gain = $1,100 - $800 = $300 since automobile was 6 months old and equipment had zero basis

The Acmeville Metropolitan Bus Service currently charges $0.88 for an all-day ticket, and is used by an average of 433 riders a day. The bus company is not earning a profit, but according to their contract with the city, they cannot cut the number of buses on the road. They must therefore find a way to increase revenues. The bus company is considering increasing the ticket price to $0.99. The marketing department\'s studies indicate this price increase would reduce usage to 169 riders per day. Calculate the price elasticity of demand for bus tickets to determine if the bus company should increase price or decrease price to increase revenues.Price elasticity of demand is? 7.45 I get but on the online hw, it says its wrong? I tried 7.5 too? I used the midpoint formula (q2-q1)/((q2+q1)/2) / (p2-p1)/((p2+p1)/2)

Answers

Answer:

Midpoint formula = - 7.43

Other formula = - 4.88

Elastic PED - Decrease price to increase total revenue

Explanation:

Price elasticity of demand is the responsiveness of quantity demanded to a change in price. The midpoint formula calculation is as follows:

(Q2 - Q1) / [(Q2 + Q1/2]

(P2 - P1) / [(P2 + P1/2]

In this scenario:

Q1 = 433 (old quantity)

Q2 = 169 (new quantity)

P1 = 0.88 (old price)

P2 = 0.99 (new price)

When this is substituted into the formula, it is as follows (I shall do it one step at a time to make it easier):

(169 - 433) / [(169 + 433/2]

(0.99 - 0.88) / [(0.99 + 0.88/2]

(169 - 433) / 301

(0.99 - 0.88) / 0.935

- 264 / 301

0.11 / 0.935

- 0.877

0.118

PED =- 7.43(PED is always a negative figure because price and quantity demanded have an inverse relationship. i.e. when one falls, the other rises)

PED is elastic if it is more than 1 and elastic if it is less than 1.

In this case, 5.8 is more than 1, hence PED is elastic.

In such a case, a change in price will always lead to a higher change in quantity demanded. Therefore, it is important to decrease the price to increase total revenue.

However, a different answer can be obtained using a different PED calculation

% change in quantity demanded

% change in price

(Q2 - Q1) / Q1

(P2 - P1) / P1

(433 - 169) / 433

(0.99 - 0.88) / 0.88

0.61

0.125

PED = - 4.88

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