Give an example of how an intermediary adds value to a product
What will be an ideal response?
Answer: Intermediaries sell products where people want them. An example of this is a wholesaler that moves apples from orchards into retail stores, making it easier for consumers to shop for them.
Explanation: Intermediaries change materials into useful products, sell products where people want them, sell products when people want them, provide knowledge about products, help customers acquire the products, and help customers use the products. An example of an intermediary selling products where people want them is a wholesaler that moves apples from orchards into retail stores, making it easier for consumers to shop for them.
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Which one of the following relationships is CORRRECT?
A) Decision variables reflect the value of uncontrollable variables. B) Dependent variables reflect the value of decision and uncontrollable variables. C) Uncontrollable variables reflect the value of decision variables. D) Uncontrollable variables reflect the values of dependent variables.
CashCow Inc is all equity financed and generates perpetual annual EBIT of $100. Assume that the EBIT, and all other cash flows, occur at year end and that we are currently at the beginning of a year
CashCow has 150 shares outstanding and shareholders require a return of 10%. CashCow hires a new CEO, a Mr. Cowslowski, who spends 10% of EBIT on parties, houses and yachts. Assume that this spending is expected to continue in perpetuity. What price will the shares trade at after Mr. Cowslowski is hired? The tax rate is 40%. A) $3.20 B) $3.40 C) $3.60 D) $3.80 E) $4.00