7. Another example of opportunity cost is a company's cost of capital. Suppose a manufacturer wants to add microwave ovens to its product line. To do this, it must invest $500,000 in new equipment.

Besides the original investment, the company estimates it would spend $200,000 per year on production
costs for labor and materials. It also estimates that it could sell about $225,000 worth of microwave ovens
each year. Would it benefit the company to manufacture the microwave ovens if it could earn 10 percent
interest by purchasing U. S. Treasury bonds with the $500,000? Explain your answer.

Recently, verizon wireless ran a pricing trial in order to estimate the elasticity of demand for its services. the manager selected three states that were representative of its entire service area and increased prices by 5 percent to customers in those areas. one week later, the number of customers enrolled in verizon's cellular plans declined 4 percent in those states, while enrollments in states where prices were not increased remained flat. the manager used this information to estimate the own-price elasticity of demand and, based on her findings, immediately increased prices in all market areas by 5 percent in an attempt to boost the company's 2016 annual revenues. one year later, the manager was perplexed because verizon's 2016 annual revenues were 10 percent lower than those in 2015"the price increase apparently led to a reduction in the company's revenues. did the manager make an error? yes - the one-week measures show demand is inelastic, so a price increase will decrease revenues. yes - the one-week measures show demand is elastic, so a price increase will reduce revenues. yes - cell phone elasticity is likely much larger in the long-run than the short-run. no - the cell phone market must have changed between 2011 and 2012 for this price increase to lower revenues.

Which of the following is not a consideration when determining your asset allocation

If the family’s net monthly income is 7,800 what percent of the income is spent on food clothing and housing?