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Froes rationalizes t palpebra the One Lesson of Business is that, riches is created when assets move from lower to exalteder- c argon ford functions. (p. 12) Froes goes on to lead most of the chapter talking abtaboo how taxation destroys wealth and that organisation subsidies (and all presidential term disbursal is a subsist) also destroys wealth. exercise Frosts unrivalled lesson of transmission line to a peculiar(prenominal) establishment tax-and- spend decision that you reliever or else usance the sensation lesson of strain to explain why you be an anarchist.AY) If you atomic number 18 not an anarchist, then explain how the government creates wealth by axing-and-spending to produce soundly-nigh broadcast somewhere that you support. Why do you think that the tax dollars are worthy less to taxpayers than the value of the government program you selected? This cant be a zero-sum game that happens to wellbeing you personally. The One Lesson of Business is abou t wealth creation. For practice session, I cant simply defend Medicare because I like that it pays for my mformer(a)s health care. That doesnt explain whether Medicare creates wealth.I would essential to liberate whether Medicares chalk up benefits to society are greater than its woo to society. If government doesnt create value somewhere, then we would be better away without it and we should be anarchists. AY) If you are an anarchist, then explain why all taxation and government spending (subsidies) should be eliminated. In particular, you should realize on the biggest spending programs of government defense, healthcare (mostly Medicare), pensions (mostly Social Security), and education.These programs account for over 2/3 of positive government spending (including state and local government), so if you are an anarchist, you should focus on where most of the currency goes. . Froes interprets that businesses that are less bureaucratic and more(prenominal) free-market go a way be more successful. For example, on page 16, Froes says that, Organizations impose taxes, subsidies, and bell controls in spite of appearance their companies that lead to unprofitable decisions. Pick one of the following questions and indicate whether you stomach chosen to address X or Y X) How do corporations and other organizations tax the individuals, divisions, and/pr departments at heart the organization? Give a specific example. Do not use any government mandated taxes as your example. Would the organization be better off if it tout ensemble avoided the kind of taxation in your example? Y) How do organizations impose legal injury controls? Give an example where a bureaucrat (manager) imposes a damage control (a pre-determined, fixationed worth) upon the people in the organization.Explain whether it is better to eliminate this particular value control. 7. Suppose you have capital that is before long worth $1,000 and your cost of capital (WAC) is 10%/ yr. How muc h operating profit per year would you requirement to earn to be generating economic value by staying in business according to EVA? 8. Think of a peace-loving example outside of the textbook where individual in an organization (team, school, business, government, etc. ) make a bad decision and use Frosts rational actor paradigm to key out the problem. A) What is the problem (very briefly)? B) What caused the bad decision?C) How could you fix the problem? Could anyone change the organizational structure, information, incentives, (or culture)? How well would your proposed change solve the problem? 9. You travelled to Memphis over the weekend and need to return to work in capital of Ohio early Monday morning. On Sunday afternoon, your race is postponed until Monday night due to hurricane Eke. Since this is a pastime trip, you bought a non-refundable rag for $250. You can heretofore get a ticket on a Greyhound bus for $90 and motionlessness get home by 6AMA. Under what circums tances should you buy the Greyhound ticket and ride the dog overnight? 0. You are the payoff manager for Widgets, Inc. up-to-date toil is 1,000 widgets and all have been locateed by your regular customers. The phone rings and a new customer wants to buy 1 more widget and offers you $1,000 if you increase production to 1,001 widgets. Should you accept this offer? Remember that it is a good deal harder to make decisions if you Just try o estimate the cost than if you figure out the fall profit. You do not need to know what the other customers paid. Below are your average total cost which is the total cost divided by the criterion of widgets.Quantity Average Total Cost Current Production 1 ,oho $200 keep back One More? 1,001 $201 A) What is the fringy tax of portion outing one more? B) What is the total cost currently ( moveing 1000 social units) C) What would the total cost be if you sell 1001 units? D) What is the bare(a) cost of producing the 1st widget? E) What do you tell the new customer? 11. A) Your fast(a) received an REP (request for proposal) on a wire harness from GM hat will require an investment with better be of $1 million and a constant marginal cost per unit of $1 with expected sales of 1 million units.What is the break-even price per unit that you will need to quote in order to avoid losing money? B) GM agrees to the price you quoted, and then hands you with a club soda (purchase order) for 0. 5 million units, what do you say? Why? 12. You have decided be of $100/year, and you can produce and sell 100 units per year but you sell a commodity, so you are at the mercy of the going market price and you cannot raise your price above whatever price the market is currently at. Your marginal cost is $5. If the market price declines, what is your break-even price below which you will shut quite a little?Note that in that location are cardinal different answers for two different doable scenarios. Give both possible answers for full -of-the-moon credit. Dont worry about the opportunity cost of capital (WAC). Assume that that is included within the fixed cost figure. 13. Suppose thither are two technologies for producing pizzas in Macaque. The solar oven requires $100 in fixed costs, but $9 in marginal costs versus the electric oven which requires $50 in fixed costs but $10 in marginal costs due to the high cost f electricity.What amount of money of production will make you indifferent amid the two different technologies? This is useful because in making capital expenditure decisions there is often this tradeoff and finding the break-even beat helps strategies about which investment will be most profitable. The idea is that for small quantities one technology will have high(prenominal) total costs and for large quantities the other technology will have higher total costs. Your Job is to see what quantity makes you indifferent between the two technologies because they have the same total cost.