ADMN 410 - MIS Exam 1 |Questions
Solved 100% Correct| Verified
Solutions
Total Sales/Cost - ANSWER = fixed cost + variable cost
Total Revenue - ANSWER =chosen price X demand
Net Income/ Profit - ANSWER A company's total earnings
= total revenue - total cost
Variable Cost - ANSWER Costs that vary depending on a company's production volume
(rise as production increases, fall as production decreases)
= demand X unit variable cost
ex. raw materials, advertising
Breakeven - ANSWER = fixed cost / (chosen price - unit variable cost)
The smaller the break even the better because a smaller number will be needed
to produce in order to break even
A higher (or increased) price will DECREASE breakeven
A smaller (or decreased) price will INCREASE breakeven
A higher (or increased) fixed cost will INCREASE brkevn
A smaller (or decreased) fixed cost will DECREASE brkevn
, Fixed Cost - ANSWER Expenses that do not change as a function of the activity of
a business
ex. machine cost or cost of renting space
Sensitivity Analysis - ANSWER Used to determine how different values of an
independent variable will impact a particular dependent variable under a given set
of assumptions.
-Now that you have found out how much it will cost you each month to own a hot
car, you decide to work a little sensitivity magic on the numbers.
Add a data table to your model to find out the impact of interest rates on your monthly
payment
Add a two-way data table to see the impact of different down payment amounts (after all
after graduating you should pick up some serious gift-coin), and varying interest rates
What do you think? Should you put more money down or try to get a better
interest rate? Or do something else?
Monthly Payment - ANSWER =PMT(rate,nper,pv,[fv],[type])
interest rate, number of payment periods, present value of loan
How to Reduce Monthly Payment? - ANSWER - Increase down payment
- Lower interest rate
Total Payment - ANSWER Monthly Payment X Term X 12 + Down Payment
Solved 100% Correct| Verified
Solutions
Total Sales/Cost - ANSWER = fixed cost + variable cost
Total Revenue - ANSWER =chosen price X demand
Net Income/ Profit - ANSWER A company's total earnings
= total revenue - total cost
Variable Cost - ANSWER Costs that vary depending on a company's production volume
(rise as production increases, fall as production decreases)
= demand X unit variable cost
ex. raw materials, advertising
Breakeven - ANSWER = fixed cost / (chosen price - unit variable cost)
The smaller the break even the better because a smaller number will be needed
to produce in order to break even
A higher (or increased) price will DECREASE breakeven
A smaller (or decreased) price will INCREASE breakeven
A higher (or increased) fixed cost will INCREASE brkevn
A smaller (or decreased) fixed cost will DECREASE brkevn
, Fixed Cost - ANSWER Expenses that do not change as a function of the activity of
a business
ex. machine cost or cost of renting space
Sensitivity Analysis - ANSWER Used to determine how different values of an
independent variable will impact a particular dependent variable under a given set
of assumptions.
-Now that you have found out how much it will cost you each month to own a hot
car, you decide to work a little sensitivity magic on the numbers.
Add a data table to your model to find out the impact of interest rates on your monthly
payment
Add a two-way data table to see the impact of different down payment amounts (after all
after graduating you should pick up some serious gift-coin), and varying interest rates
What do you think? Should you put more money down or try to get a better
interest rate? Or do something else?
Monthly Payment - ANSWER =PMT(rate,nper,pv,[fv],[type])
interest rate, number of payment periods, present value of loan
How to Reduce Monthly Payment? - ANSWER - Increase down payment
- Lower interest rate
Total Payment - ANSWER Monthly Payment X Term X 12 + Down Payment
