Blowing Sand Company produces the Drafty model fan, which currently has a net loss of $38,000 as follows:

Drafty Model
Sales revenue $ 250,000
Less: Variable costs 175,000
Contribution margin $ 75,000
Less: Direct fixed costs 69,000
Segment margin $ 6,000
Less: Common fixed costs 44,000
Net operating income (loss) $ (38,000)

Eliminating the Drafty product line would eliminate $69,000 of direct fixed costs. The $44,000 of common fixed costs would be redistributed to Blowing Sand’s remaining product lines.

Will Blowing Sand’s net operating income increase or decrease if the Drafty model is eliminated? By how much?

Your uncle borrows $53,000 from the bank at 11 percent interest over the nine-year life of the loan. use appendix d for an approximate answer but calculate your final answer using the formula and financial calculator methods. what equal annual payments must be made to discharge the loan, plus pay the bank its required rate of interest

Brandt enterprises is considering a new project that has a cost of $1,000,000, and the cfo set up the following simple decision tree to show its three most likely scenarios. the firm could arrange with its work force and suppliers to cease operations at the end of year 1 should it choose to do so, but to obtain this abandonment option, it would have to make a payment to those parties. how much is the option to abandon worth to the firm?

Because this market is a monopolistically competitive market, you can tell that it is in long-run equilibrium by the fact thatmr=mc at the optimal quantity for each firm. furthermore, a monopolistically competitive firm's average total cost in long-run equilibrium isless than the minimum average total cost. true or false: this indicates that there is a markup on marginal cost in the market for engines. true false monopolistic competition may also be socially inefficient because there are too many or too few firms in the market. the presence of the externality implies that there is too little entry of new firms in the market.