Reference no: EM13152940
McBurger hires you as a consultant to advise on its best strategy. You estimate monthly demand for its burgers to be:
Qd = 26,000 - 10,000P + 4,000Pc -.8Y + 0.5A
where the independent variables are respectively: P, price of McBurger's burgers, PC, price of competitors' burgers, Y, per capita income, and A, McBurger's advertising budget. You observe that competitors have, on average, priced their burgers at $3.50, while McBurger charges $2.50. Per capita income level in the store's geographic market is $15,000. McBurger's advertising expenditure is $20,000 per month. McBurger currently sells 13,000 burgers/month.
1. How much revenue does McBurger currently earn based on the information above?
2. Is McBurger maximizing its revenues under current conditions?
3. Based on the data given, McBurger should _______________ its advertising expenditure.
Possible answers: a) raise
b) lower
c) not change
d) we cannot say
4. What advice can you offer McBurger, based on the above information?
Role of investment bankers
: Is it true that the "flatter" or more nearly horizontal, the demand curve for a particular firm's stock, and the less important investors regard the signaling effect of the offering, the more important the role of investment bankers when the compa..
|
Advantages and disadvantages of costing method
: Discuss the advantages and disadvantages of each costing method including FIFO, LIFO, and Average Cost.
|
Define effective population size
: Define effective population size (1). Give two possible biological reasons for why the effective size of a population might differ from its census size (2). Explain the kind of deviation expected under each reason (2).
|
Cash acquisition price and carrying amount of debt
: When convertible debt is retired by the issuer, any material difference between the cash acquisition price and the carrying amount of the debt should be
|
What advice can you offer mcburger
: How much revenue does McBurger currently earn based on the information above and is McBurger maximizing its revenues
|
Key elements of the inventory costing method
: 1. Discuss the key elements of the inventory costing method. 2. Discuss why it is appropriate to use this method.
|
What is the purpose of design of experiments
: Our analysis table gives a p-value of 0.01 for Pressure -- all other effects have large pvalues -- larger than 0.25. What does this all mean?
|
Define temperature scale using the freezing point
: Suppose you decide to define your own temperature scale using the freezing point (13 C ) and boiling point (360 C) of oleic acid, the main component of olive oil
|
Determining exchange lacked commercial substance
: On April 1, 2007 when the machine has a market value of 27,500, it is exchanged for a machine with a fair value of 135,000 and the proper amount of cash is paid. The exchange lacked commercial substance.
|