Fruities Ltd Has Two Divisions, Durian Division and Juice Division

question 5

Multiple Choice

Fruities Ltd has two divisions, Durian Division and Juice Division. Durian Division has an annual capacity of 10 000 units of durian juice concentrate. Juice Division's annual requirement of durian juice concentrate is 8000 units. The variable production cost of one unit of durian juice concentrate at Durian Division is $6, but the division incurs $1 additional shipping cost per unit when selling to external suppliers. The market price for the division's durian juice concentrate is $10 per unit, and currently, the external demand for Durian Division's durian juice concentrate is 5000 units.
Using the transfer pricing formula, Durian Division should charge the Juice Division:

• A) $6.00.
• B) $7.13.
• C) $9.00.
• D) $10.00.

Realize the impact of macroeconomic policies (fiscal and monetary) on aggregate demand and aggregate supply.

Comprehend the role and critiques of discretionary fiscal policy in stabilizing the economy.

Grasp the significance of expectations (rational and otherwise) in influencing the effectiveness of macroeconomic policy.

Evaluate the time-inconsistency problem and its implications for economic policy.

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Definitions:

Emotional States

Varied psychological responses that encompass feelings, thoughts, and behavioral patterns influenced by an individual's temperament, culture, and circumstances.

Aptitudes

Natural talents or abilities for learning and proficiency in specific areas or disciplines.

Interests

Personal preferences or areas of curiosity that draw an individual's attention and motivate exploration or learning.

Wilhelm Wundt

A psychologist often regarded as the father of experimental psychology, he founded the first formal laboratory for psychological research in Leipzig, Germany.