Peppertree Company has two divisions, East and West. Division East manufactures a component that Division West uses. The variabl
e cost to produce this component is $1.58 per unit; full cost is $1.98. The component sells on the open market for $5.07. Assuming Division East has excess capacity, what is the lowest price Division East will accept for the component
The Division East is manufacturing a component that the Division West uses. Since managers of these divisions are evaluated separately on the performance of their divisions,Division East will accept at minimum the price equal to that on that its output is fetching in an open market.
The correct answer is D. All of the above are true statements.
Perpetuality is a series of infinite cash flows over time. The perpetuities are similar to the annuities in the sense that they are payments for equal amounts made in equal time intervals, the difference is that the payments or fees of the perpetuities are forever, as the name implies.
This tool is especially useful for valuing companies and, therefore, their actions, given their nature of having perpetual life. Some investments, such as preferred shares and bonds, are essentially perpetuities, and to transfer these assets from investors to investors it is necessary that they have a present value (VP).
Industrialized Agriculture: Uses substantial hardware and a lot of money related capital, non-renewable energy sources, water, business inorganic manures, and pesticides to deliver single yields.
The real objective of industrialized horticulture is to consistently build each product's yield - the measure of nourishment delivered per unit of land.
Traditional Subsistence Agriculture: Supplements vitality from the sun with the work of people and draft creatures to deliver enough products for a ranch family's survival, with minimal left over to move or store as a save for hard tough occasions.
Industrialized farming is increasingly profitable in light of the fact that its significant objective is to deliver the most yield of harvest while subsistence has the objective of creating enough to endure and live reasonably and does not have an immense spotlight on efficiency.