Answer:
Explanation:
Synergy's Choices Large Budget Small Budget Dynaco's Choices Large Budget $20 million, $25 million $15 million, $0 Small Budget $0, $60 million $25 million, $30 million If Synergy assumes
If Synergy presumes Dynaco will opt for a large budget, then Synergy should also select a large budget.
If Synergy thinks Dynaco will choose a small budget, Synergy should still go for a large budget.
This indicates that Synergy indeed has a dominant strategy.
If Dynaco believes Synergy will pursue a large budget, it will likewise pursue a large budget.
Conversely, if Dynaco believes that Synergy will choose a small budget, it will choose a small budget as well.
Therefore, Dynaco lacks a dominant strategy.
Correctly stated, the Nash equilibrium is found at (large budget, large budget).
<span>The primary issue at Bond's Gym is that demand exceeds capacity. Therefore, implementing negative incentives is the most effective approach. Positive incentives would only attract more customers, worsening the situation. Negative incentives could benefit the owner by increasing revenue and enabling gym expansion to serve more clients.</span>
Answer:
Income statement prepared under the absorption costing method
Sales 2,600,000
Less: Cost of Goods Sold
Beginning Inventory 0
Add: Cost of Goods Produced
Materials Used 1,218,000
Labor Costs 522,000
Variable Overhead 87,000
Fixed Overhead 130,500
Less: Ending Inventory (1,957,500/4,350)×350 (157,500) 1,800,000
Gross Profit 800,000
Less: Operating Costs:
Selling and Administrative Expenses:
Variable Sales/Administrative Costs (60,000)
Fixed Sales/Administrative Costs (25,000)
Net Profit 715,000
Explanation:
Product/Manufacturing Cost under Absorption Costing = Direct Materials + Direct Labor + Variable Overheads + Fixed Overheads
Period Cost under Absorption Costing = All Non-Manufacturing Expenses
