![angienunez2983](/avatars/16623.jpg)
angienunez2983
16.07.2021 •
Business
Because industry X is characterized by perfect​ competition, every firm in the industry is earning zero economic profit. If the product price​ falls, no firm can survive. Do you agree or​ disagree? Discuss. This statement is A. correct because firms would be earning negative economic profit. B. incorrect because firms will increase supply in the long ​run, producing more output to offset the decrease in price. C. incorrect because firms will exit the industry in the long​ run, reducing supply until the price rises to the lowest point on the​ long-run average cost curve. D. incorrect because firms will produce in the short run as long as price is above the average fixed cost of production. E. incorrect because new firms will enter the industry in the long​ run, increasing demand until the price rises to the lowest point on the​ long-run average cost curve.
Solved
Show answers
More tips
- H Health and Medicine How to Whiten Teeth and Get the Perfect Smile...
- S Style and Beauty How to Properly Apply Eye Makeup: Tips from a Professional Makeup Artist...
- A Auto and Moto How Can Parking Sensors Help Drivers?...
- C Computers and Internet Make Money Online: Secrets and Essential Ways...
- A Auto and Moto What is the Average Lifespan of an Engine in a Car?...
- H Health and Medicine What You Need to Know About Nasal Congestion in Infants: Causes, Symptoms, and Treatment...
- S Science and Technology Discovering the Anatomy of an LCD TV Screen...
- F Food and Cooking How to Get Reconfirmation of Registration?...
- F Food and Cooking Why Doesn t the Confirmation Link Come to Email?...
- F Food and Cooking Deflope: What is it and how does it work?...
Answers on questions: Business
- B Business Am always concerned about my job. very true or not at all...
- B Business What tends to be the primary factor in creating arousal for an exhibitionist?...
- B Business On January 1, 2019, Calvert Company issues 10%, $100,000 face value bonds for $103,629.90, a price to yield 8%. The bonds mature on December 31, 2020. Interest is paid semiannually...
- B Biology Radiometric dating allows us to determine... a. Which rock layers are the oldest. b. The relative ages of the layers of rocks and the fossils within them. c. The exact or...
- S Spanish ¿__ (tú) jugar al fútbol americano? •Conoces •Sabes •Conoce •Sabe...
- B Biology Pls help, this is science class btw Think about the meanings of the words dependent and independent as they relate two variables. What do you think interdependence means...
- E English Mount St. Helens, a volcano, was known as the Mount Fuji of the West. Before it blew its top in the 1980s, the pyramid shape of Mount St. Helens, in the Cascade Range of...
- M Mathematics Can someone help me with this ASAP please I’m being timed !...
- M Mathematics (6.9x10^5)x(3.1x10^-9) write answer in scientific notation, thank you!...
- E English The elderly couple are alone inside a house that is perched high on a hill, and they quietly long for a visit from their long-time friend. What are the ADVERBS in this...
Ответ:
Deere & Company (DE)
1. Calculation of Ratios:
a) Return on total assets = Net income divided by the average total assets, multiplied by 100.
Year 3 = $1,523.9/$57,965 x 100 = 2.6%
Year 2 = $1,940.0/$ 59,642 x 100 = 3.3%
Year 1 = $3,161.7 /$ 60,429 x 100 = 5.2%
b) Return on stockholders' equity: Earnings after taxes/Stockholders' equity x 100.
Year 3 = $1,523.9/$ 6,644 x 100 = 22.9%
Year 2 = $1,940.0/$7,912 x 100 = 24.5%
Year 1 = $3,161.7 /$ 9,667 x 100 = 32.7%
c) Earnings per share: Net Income/No. of outstanding shares.
Year 3 = $1,523.9/315 = $4.84
Year 2 = $1,940.0/334 = $5.81
Year 1 = $3,161.7 /363 = $8.71
d) Dividend yield: This is equal to the annual dividend per share divided by stock price per share, and multiplied by 100.
Year 3 = $2.40/$92.03 x 100 = 2.61%
Year 2 = $2.40/$81.10 x 100 = 2.96%
Year 1 = $2.22/$85.58 x 100 = 2.59%
e) Price-earnings ratio: This is equal to market price per share divided by the earnings per share.
Year 3 = $92.03/$4.84 = 19.0 times
Year 2 = $81.10/$5.81 = 13.9 times
Year 1 = $85.58/$8.71 = 9.8 times
Explanation:
a) Data
Year 3 Year 2 Year 1
('millions) ('millions) ('millions)
Net income (loss) $1,523.9 $1,940.0 $3,161.7
Preferred dividends $ 0.00 $ 0.00 $ 0.00
Interest expense $763.7 $ 680.0 $ 664.0
Shares outstanding 315 334 363
for computing earnings per share
Cash dividend per share $ 2.40 $ 2.40 $ 2.22
Average total assets $57,965 $ 59,642 $ 60,429
Average stockholders' equity $ 6,644 $7,912 $ 9,667
Average stock price per share $ 92.03 $ 81.10 $ 85.58
b) Return on total assets = Net income divided by the average total assets, multiplied by 100. It shows how well a company generates net income from assets.
Year 3 = $1,523.9/$57,965 x 100 = 2.63%
Year 2 = $1,940.0/$ 59,642 x 100 = 3.25%
Year 1 = $3,161.7 /$ 60,429 x 100 = 5.23%
c) Return on stockholders' equity: Earnings after taxes/Stockholders' equity x 100. It demonstrates how much of the earnings after taxes are available to stockholders.
Year 3 = $1,523.9/$ 6,644 x 100 = 22.94%
Year 2 = $1,940.0/$7,912 x 100 = 24.52%
Year 1 = $3,161.7 /$ 9,667 x 100 = 32.71%
d) Earnings per share: Net Income/No. of outstanding shares. It shows in dollar terms how much of the earnings made by a company is available to stockholders on the average of each share.
Year 3 = $1,523.9/315 = $4.84
Year 2 = $1,940.0/334 = $5.81
Year 1 = $3,161.7 /363 = $8.71
e) Dividend yield: This is equal to the annual dividend per share divided by stock price per share, and multiplied by 100. It shows how a company pays dividend each year in relation to its share price.
Year 3 = $2.40/$92.03 x 100 = 2.61%
Year 2 = $2.40/$81.10 x 100 = 2.96%
Year 1 = $2.22/$85.58 x 100 = 2.59%
f) Price-earnings ratio: This is equal to market price per share divided by the earnings per share. It shows if a company is overvalued or undervalued.
Year 3 = $92.03/$4.84 = 19.0 times
Year 2 = $81.10/$5.81 = 13.9 times
Year 1 = $85.58/$8.71 = 9.8 times
g) Ratios are used to present a picturesque view of a company's financial performance and position to make easily understood and compared with other companies in the industry and over the years (trend analysis). They are important financial management and investment tools, which should, however, not be taken in isolation.