Suppose that you are the owner of a local sandwich shop. Your supplier of bread has increased its wholesale price by 10 percent, your supplier of condiments has raised prices by 10 percent, and your supplier of meats and vegetables has raised prices by 10 percent. Suppose these are your only supplies. Therefore, you decide to raise your sandwich prices accordingly. If you wish to maintain the same level of profit given the increases in your supply prices, you should increase your sandwich prices by what percentage?

a. 5 percent
b. 30 percent
c. 100 percent
d. 20 percent
e. 10 percent

In general, you add percentages as you would add cadinal numbers.

Which of the following actions would be most likely to reduce potential conflicts of interest between stockholders and managers? a. change the corporation's formal documents to make it easier for outside investors to acquire a controlling interest in the firm through a hostile takeover. b. eliminate a requirement that members of the board of directors must hold a high percentage of their personal wealth in the firm's stock. c. for a firm that compensates managers with stock options, reduce the time before options are vested, i. e., the time before options can be exercised and the shares that are received can be sold. d. pay managers large cash salaries and give them no stock options. e. beef up the restrictive covenants in the firm's debt agreements.