Exercises   130.Suez Bakery produces and sells chocolate silk pies, each having a variable cost of $3.80. Total fixed costs are $34,000. Management estimates demand at various activity levels as follows:   Units Demanded              Unit Price 6,000              $10.20 7,200              9.40 8,000              8.50 8,900              8.00 10,100              7.50   a.Calculate the total contribution margin at each price level. b.Which price maximizes profit?     131.The editor […]

  111.MallardCorporationhadaprice-earningsratioof15,paidadividendof$3,andretainedearningsof$1ashare.WhatwasthepriceofashareofMallardstock? a.$15 b.$30 c.$45 d.$60. 112.BountifulTractorshasasharepriceof$60,retainedearningsof$2pershare,andadividendyieldof2percent.WhatisBountifulTractor’sprice­earningsratio? a.23.1 b.18.75 c.15 d.30 113.Acorporation’searningsare a.theamountofrevenueitreceivesforthesaleofitsproductsminusitscostsofproductionasmeasuredbyitsaccountantsminusthedividendspaidout. b.theamountofrevenueitreceivesforthesaleofitsproductsminusitsdirectandindirectcostsofproductionasmeasuredbyitseconomistsminusthedividendspaidout. c.theamountofrevenueitreceivesforthesaleofitsproductsminusitscostsofproductionasmeasuredbyitsaccountants. d.theamountofrevenueitreceivesforthesaleofitsproductsminusitsdirectandindirectcostsofproductionasmeasuredbyitseconomists. 114.Retainedearningsare a.earningsofacompanythatarenotpaidouttostockholders. b.theamountofrevenueacorporationreceivesforthesaleofitsproductsminusitscostsofproductionasmeasuredbyitsaccountants. c.thesinglemostimportantpieceofinformationaboutastock. d.computedbymultiplyingthedividendyieldbythepriceofthestock. 115.Theamountofrevenueafirmreceivesforthesaleofitsproductsminusitscostsofproductionasmeasuredbyitsaccountantsisthefirm’s a.earnings. b.retainedearnings. c.economic,orreal,profit. d.dividend. 116.Historically,thetypicalprice-earningsratioforstocksisabout a.3 b.8 c.15 d.26 117.Ahighprice-earningsratioforastockindicatesthateitherthestockis a.undervaluedorpeoplearerelativelyoptimisticaboutthecorporation’sprospects. b.overvaluedorpeoplearerelativelyoptimisticaboutthecorporation’sprospects. c.overvaluedorpeoplearerelativelypessimisticaboutthecorporation’sprospects. d.undervaluedorpeoplearerelativelypessimisticaboutthecorporation’sprospects. 118.Alowprice-earningsratioindicatesthateitherthestockis a.undervaluedorpeoplearerelativelyoptimisticaboutthecorporation’sprospects. b.overvaluedorpeoplearerelativelyoptimisticaboutthecorporation’sprospects. c.overvaluedorpeoplearerelativelypessimisticaboutthecorporation’sprospects. d.undervaluedorpeoplearerelativelypessimisticaboutthecorporation’sprospects. 119.IfpeopleexpectfutureearningsofGaltCorporationtobehighrelativetocurrentearnings,then a.theP/Eratioofitsstockwillbehigh.AP/Eratioof 8isrelatively high. b.theP/Eratioofitsstockwillbehigh.AP/Eratioof8isrelativelylow. c.theP/Eratioofitsstockwillbelow.AP/E ratioof 8isrelatively high. d.theP/Eratioofitsstockwillbelow.AP/Eratioof8isrelativelylow. 120.LongviewCorporationhasastockpriceof$60,hasissued1,000,000sharesofstock,hasretainedearningsof$3milliondollars,andadividendyieldof5percent.Theprice-earningsratioforLongviewstockis a.20,whichishighcomparedtohistoricalstandardsofthemarket. b.20,whichislowcomparedtohistoricalstandardsofthemarket. c.10,whichislowcomparedtohistoricalstandardsofthemarket. d.10,whichishighcomparedtohistoricalstandardsofthemarket.    

  71. Peace Products Inc.Peace Products Inc. uses process costing. The following information was available for the current year:   Numberof units   ProductionCosts Beginning work-in-process (40% complete) 1,000   $  11,700 Units started in the current period 40,000   604,500 Ending work-in-process (50% complete) 6,000             Refer to the Peace Products Inc. information above. If Peace uses the first-in, first-out […]

  86.Which of these statements about emotional labor is true?  A.Jobs involving customer service do not require emotional labor. B.Research indicates that emotional display rules and standards are very similar around the world. C.Emotional labor increases with the extent to which employees must abide by emotional display rules. D.Emotional labor occurs when we perceive an inconsistency between our beliefs, feelings, and behavior. E.Emotional labor demands […]

    11) Countries that enjoy economic growth A) have property rights and markets which provide incentives for discovering new technologies. B) have economies that allow the government to make decisions in everyone’s best interests. C) restrict international trade so that domestic industries can grow. D) place high taxes on saving and investment. E) place controls on property rights so that firms are protected from […]

  101.The motivation for much of the foreign direct investment by non-U.S. firms was the desire to:   A. disperse production activities to optimal locations. B. suppress the emerging economies such as China, India, and Brazil. C. spread communism throughout the world. D. increase the competition between domestic industries and U.S. corporations. E. bridge the national differences in culture, consumer preferences, and business practices. 102.The _____ refers to the total cumulative […]

  21) The CPI market basket is determined by A) tax return data of households. B) supermarket purchases recorded by scanner technology. C) profit releases of the largest companies. D) a consumer survey. E) surveys asking large retail companies, such as Wal-Mart, about their sales of consumer goods and services. 22) For the CPI, the market basket of goods and services is modified A) each […]

  41) Singapore banned the import, manufacture, and sales of chewing gum in the country since wads of gum were making a mess on sidewalks, buses, and subway trains. Violators are subject to severe penalties, and before buying a pack consumers must register their names and addresses. This, according to author William Greider, demonstrates that Singapore’s government: A) is harshly autocratic. B) administers a paranoid […]

  16.7   Integrative Questions   1) A monopoly can arise when A) there are diseconomies of scale. B) there are barriers to entry and no close substitutes for the good being produced. C) a firm cannot price discriminate. D) firms engage in rent seeking. E) a firm must set MR equal to MC in order to maximize its profit. 2) The total revenue test using […]

  91.Since 1980, the world’s containership fleet has more than quadrupled, reflecting in part the:   A. growing volume of international trade. B. decreasing productivity of labor. C. rising costs of containerization. D. increasing transportation costs. E. decreasing employment opportunities across the globe. 92.The _____ has been a major force facilitating international trade in services.   A. advent of containerization B. development of commercial jet aircraft C. retaliatory trade policies toward international trade […]