Identify the true statement regarding how product costs in a manufacturing company differ from product costs in a service company.

Lucy Treasures operates a chain of gift shops.  The company pays liability insurance premiums of $2,500 per year for each shop.  The managers of each shop are paid a salary of $1,200 per month and all other employees are paid on an hourly basis.  Relative to the number of shops, the costs of insurance is which kind of cost?

This question is worth a total of 10 points. Misty Raines operates Misty’s Dance Academy.  Lessons are scheduled daily Monday through Friday for 50 weeks per year.  Lessons are one hour in length.  The following information is provided:                Fixed costs*                $90.00 per day             Instructor wages         $16.00 per hour             Other variable costs    $  2.00 per hour    *Annual fixed costs of $22,500 divided by 250 days (50 weeks x 5 days per week)       Required: (NOTICE THAT THERE ARE TWO (2) QUESTIONS TO ANSWER!) 1)  Compute the total cost and the cost per lesson if the following number of lessons are provided on a given day:   NUMBER OF LESSONS              1                      2                      4                      8 Fixed Costs                               $_____           $_____            $______         $_____ Instructor Wages                        _____              _____              ______           _____ Other variable Costs                   _____             _____              ______           ______ __________________________________________________________________________          Total Costs                       $                     $                     $                     $              Cost per lesson                         $                      $                     $                    $            2).     Based on the behavior of the cost per lesson, this is which type of cost:  Fixed or variable?  Why?

What is the effect on the financial statement model of recording a $100 cash purchase of raw materials? Assets = Liabilities + Equity Revenues – Expenses = Net Income Cash Flow A. (100) N/A (100) N/A – 100 (100) N/A B. 100 N/A 100 N/A – 100 (100) (100) C. N/A N/A N/A N/A N/A N/A (100) D. N/A N/A N/A N/A – 100 (100) N/A

Explain how the spending patterns of a DINK household (and define what this means) would differ from a family with young children in the family life cycle using components of the family life cycle in your answer.

Identify one trend in family structure and briefly explain how it might affect consumer behavior.

Information cascades can lead consumers to make decisions based on others’ actions rather than their own preferences.

Consumer demand depends only on a consumer’s ability to purchase a product.

A message stating “most people recycle” is using a prescriptive norm to influence behavior.

A consumer’s education and knowledge of art are examples of social capital.