A global insurance company, Global, sells auto insurance online. The company uses its own underwriters and proprietary software algorithms to make determinations on pricing and coverage. Currently, the company also services the policies in case of a claim. Global's Chief Operating Officer, Jane, is trying to decide if it makes sense to outsource the claims function, which is currently provided at a fixed cost of $1,780,000 and a variable cost of $490 per claim. Jane estimates that if she were to outsource her claims servicing function to another provider she would incur a fixed annual fee of $1,130,000 plus $540 per claim, Last year, 1,120,000 claims were serviced. a. What was the cost last year to Jane when doing the claims management in-house? Cost last year $______ b. What would the cost have been last year had she outsourced this function? Cost last year $____ c. What is the indifference point for the two alternatives? Indifference point______ claims d. If Jane estimates her claims will rise to 1,210,000 next year, should she outsource the function?____
Answers
a. The cost last year to Jane when doing the claims management in-house was $2,238,800. b. The cost last year would have been $1,835,600 if she had outsourced the function. c. The indifference point is 2,400 claims. d. Yes, she should outsource the function if her claims rise to 1,210,000 next year.
Cost last year = Fixed cost + (Variable cost per claim x a Total number of claims serviced) Cost last year = 1,780,000 + (490 x 1,120,000)Cost last year = $2,383,800
a) To determine the cost last year to Jane when doing the claims management in-house, the given fixed cost of $1,780,000 will be added to the product of the variable cost per claim ($490) and the total number of claims serviced last year (1,120,000).
b) To determine the cost last year had she outsourced this function, the given fixed annual fee of $1,130,000 will be added to the product of the variable cost per claim ($540) and the total number of claims serviced last year (1,120,000).
Hence, Cost last year = Fixed annual fee + (Variable cost per claim x a Total number of claims serviced)Cost last year = 1,130,000 + (540 x 1,120,000)Cost last year = $1,803,800
c) The indifference point is the point at which both alternatives provide the same total cost. It can be calculated by equating the total cost equations of the two alternatives and solving for the unknown variable (number of claims serviced). Let the number of claims services at the indifference point be x.
The total cost of in-house claims management = Fixed cost + (Variable cost per claim x a Total number of claims serviced)= 1,780,000 + (490x)Total cost of outsourced claims management = Fixed annual fee + (Variable cost per claim x Total number of claims serviced)= 1,130,000 + (540x)1,780,000 + (490x) = 1,130,000 + (540x)Solving for x,490x - 540x = 1,780,000 - 1,130,000-x = 925,000
d) If Jane estimates her claims will rise to 1,210,000 next year, she should compare the costs of both alternatives at this level.
Cost of in-house claims management next year= Fixed cost + (Variable cost per claim x Total number of claims serviced)= 1,780,000 + (490 x 1,210,000)Cost of in-house claims management next year= $2,348,900
Cost of outsourced claims management next year= Fixed annual fee + (Variable cost per claim x a Total number of claims serviced)= 1,130,000 + (540 x 1,210,000)
Cost of outsourced claims management next year= $1,767,400Since the cost of in-house claims management next year is greater than that of outsourcing, Jane should outsource the function.
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Related Questions
In a world with taxes, interest tax shield tends to reduce a firmʹs weighted average cost of capital.a. Trueb. False
Answers
True. The interest tax shield is the tax savings that a company receives due to the tax-deductibility of interest payments on debt. This results in a reduction of the company's overall tax liability. As a result, the after-tax cost of debt is lower than the cost of equity, which reduces the weighted average cost of capital (WACC).
Therefore, in a world with taxes, the interest tax shield tends to reduce a firm's WACC, making it a valuable tool for companies to minimize their overall cost of capital.The statement "In a world with taxes, interest tax shield tends to reduce a firm's weighted average cost of capital" is True.
Interest tax shield is the reduction in taxable income resulting from deducting interest payments on debt. This benefit lowers a firm's overall tax liability and, consequently, its weighted average cost of capital (WACC). By reducing WACC, the interest tax shield makes it more attractive for firms to utilize debt financing, ultimately leading to a lower overall cost of capital for the firm.
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2. If a school's total cost of attendance is $23,000 and your EFC is $5,000, how much need-based aid could you qualify for?
Answers
Answer:
$28,000 or $18,000
Explanation:
BOB OS THE BEST PERSON IN THE WORLD
If your COA is $10,000 and your EFC is $5,000, for example, you cannot get more need-based assistance than $5,000.
Your Expected Family Contribution (EFC), an index number, will determine your eligibility for federal student financial aid.
Describe EFC?Your Expected Family Contribution (EFC), an index number, will determine your eligibility for federal student financial aid.This amount was calculated using the information you provided on your Free Application for Federal Student Aid (FAFSA) form.According to the government, your EFC should be higher the more you can afford to pay for college.If one's EFC score is high, they will be eligible for less need-based federal financial aid for college.Your EFC is determined using a method that takes into consideration the family's benefits, assets, and both taxable and untaxable income.Learn more about EFC refer to:
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What are some facts about fishing?
Answers
Answer:
1.Fishing is the activity of trying to catch fishes using different automated and traditional techniques.
2.An angler is a person who fishes with a rod and line.
3.One million Americans spend an average of 17 days fishing.
4.Anglers spent a total of $15.5 billion dollars on fishing in 2011.
5.An average angler spends $1,261 on fishing each year.
The fun thing about sports fishing is that mostly, the caught fish is thrown back into the sea or river. Since, there are so many kinds of fish, it is a clear fact that there needs to be more than one way of catching the fish.
Explanation:
Greg's average balance checking account pays simple interest of 5.4% annually, and he made $7.20 in interest last month. What was Greg's average balance last month?
Answers
Answer:
Greg's average balance last month was $ 1,600.
Explanation:
Given that Greg's average balance checking account pays simple interest of 5.4% annually, and I have made $ 7.20 in interest last month, to determine what was Greg's average balance last month the following calculation must be performed:
5.4 / 12 = 7.20
100 = X
0.45 = 7.20
100 = X
100 x 7.20 / 0.45 = X
720 / 0.45 = X
1600 = X
Therefore, Greg's average balance last month was $ 1,600.
Newstar Foods is a company manufacturing cereal It has an annual demand for two flavors: Strawberry cereal and Blueberry cereal of 592600 and 608,030 boxes respectively. Each box contains 18 ounces of cereal and exactly half of the weight of the cereal comes from its fruit Istrawberry or blueberry and both fruits are imported from Japan Newstar Foods has computed Its ordering cost as US$60 per order. They pay their Japanese supplier 12.5 US cents per pound (there are 16 ounces in a pound) of strawberry and 10 cents per pound of blueberry. The annual holding cost of either truit is 20% of the value of the fruit Answer the following questions based on the data above. Choose the closest number if needed. If you combine orders for each fruit into one monthly order (in other words, instead of using the EOQ policy, we will just send out one single monthly order combined for both fruits), it will still only cost $60 for the combined order What is the annual savings in total fixed order and inventory holding costs, compared to the separate EOQ policy for each fruk earlier? $250 cost increase 3554 swings $400 cost increase No savings $570 svines
Answers
EOQ is the abbreviated form of Economic Order Quantity. This is a formula that calculates the amount of inventory to purchase each time to decrease the total cost of holding and ordering inventory.
The annual demand for Strawberry cereal is 592,600 boxes. The demand for Blueberry cereal is 608,030 boxes. Each cereal box contains 18 ounces of cereal, and 50% of that weight comes from either strawberry or blueberry. Both fruits are imported from Japan. Newstar Foods calculated the order cost to be $60 per order. They pay their Japanese supplier 12.5 US cents per pound (there are 16 ounces in a pound) of strawberry and 10 cents per pound of blueberry. The annual holding cost of either fruit is 20% of the fruit's value.Annual savings compared to the separate EOQ policy for each fruit earlier is $570 svines.Given data:Economic order quantity of Strawberry cereal = 25085Economic order quantity of Blueberry cereal = 27160Total number of orders for Strawberry cereal = 592600 / 25085 = 24Total number of orders for Blueberry cereal = 608030 / 27160 = 23Fixed order and holding cost for Strawberry cereal is:24 orders × $60 per order = $1,440Fixed order and holding cost for Blueberry cereal is:23 orders × $60 per order = $1,380Cost of holding Strawberry cereal inventory:592600 boxes × 18 oz/box × 0.5 × 0.2 × $0.125/16oz = $8,706Cost of holding Blueberry cereal inventory:608,030 boxes × 18 oz/box × 0.5 × 0.2 × $0.10/16oz = $6,960Thus, the total cost of the EOQ policy for Strawberry cereal and Blueberry cereal is:$1,440 + $1,380 + $8,706 + $6,960 = $18,486Now, let us consider that instead of using the EOQ policy, we will combine orders for each fruit into one monthly order. The combined cost would be $60.Annual savings compared to the separate EOQ policy for each fruit earlier would be:$18,486 - $60 = $18,426Annual savings in total fixed order and inventory holding costs compared to the separate EOQ policy for each fruit earlier is $570 svines.Therefore, option E is correct.
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Gary and Florence are hired at the same time for the same position. They are both equally qualified, but Florence, who is blind, is paid less because the company thinks she will not be able to complete as much work as Gary. This is an example of
ethnic discrimination
disability discrimination
racial discrimination
religious discrimination
please answer this aspa!
Answers
What determines what goods and services are produced by a nation in the economy?
O The wants of other nations
O The wants of the citizens
None of the answers are correct
Answers
The factor that determines the goods and the services that are produced by a country is the wants of the citizens.
What is want in economics?This is a term that has to do with the goods and services that are desired by the people of a nation.
The wants of the people are satisfied using the available resources that are in the economy.
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At work, Mario was trying to show Jenessa the new procedure for stocking the shelves. Jenessa kept working as he explained and quickly became frustrated because Mario kept telling her she was doing it wrong. What could Jenessa have done first to be a better active listener?
Answers
Answer: She could have stopped what she was doing to give Mario her full attention.
Explanation: I took the test
Select the correct answer.
Kelly paid salary to her employees at the end of the month. What will be the journal entry for the given financial transaction?
A. Employee Account - Debit
Employee Account - Debit
B.
C. Salary Account - Debit
D. Salary Account - Debit
Cash Account - Credit
Kelly Account - Credit
Cash Account - Credit
Kelly Account - Credit
Reset
Next
Answers
Answer:
Explanation
Answer will be
C
Salary Account Debit
Cash Account Credit
Is financial analyst hard to study?
Answers
Financial analysts are reimbursed well. The median pay in 2010 was more than $74,000 annually, according to the most recent figures released by the U.S. Bureau of Labor Statistics. ... Working as a financial analyst is an extremely stressful career, defined by long work hours and high pressure levels.
It may be hard but not IMPOSSIBLE!
Best wishes! :)
Describe factors that encourage conspicuous
consumption by the purchase of status sym-
bols.
Answers
Veblen's initial thesis said that better social standing and peer recognition were the two key factors influencing ostentatious consumption.
Conspicuous consumerism is the act of acquiring things or services specifically with the intention of flaunting one's affluence. When publicly exhibited products and services are too expensive for other people in a person's class, conspicuous spending is a way to demonstrate one's social position.
What is the conspicuous consumerism theory?
Conspicuous consumption is defined as. Displaying extravagant riches in order to improve one's standing and reputation in society is known as conspicuous spending.To Learn more about conspicuous consumption, click the links
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a defines how the marketing group will use its resources to support the company's goals for growth and earnings
Answers
A marketing plan outlines how to use the company's resources most effectively to accomplish its marketing goals.
What is marketing plan?An organization's advertising strategy for generating leads and reaching its target market is outlined in a marketing plan, which is a practical document.
A marketing strategy outlines the outreach and PR initiatives that will be implemented over time, along with how the business will evaluate their success.
Because a marketing plan is created based on a broad strategic framework, the phrases marketing plan and marketing strategy are sometimes used synonymously.
The strategy and the plan may occasionally be combined into one document, especially for smaller businesses that might only run one or two significant campaigns per year.
While the marketing strategy provides the overall value proposition, the plan details marketing actions on a monthly, quarterly, or annual basis.
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Olivia is really good at working with computers and has been helping at her mom's company by setting up and maintaining the employee's computers. Which pathway of the Information Technology cluster would be a possible future career for her? Question 2 options: Information Support and Services Network Systems Programming and Software Development Web and Digital Communications
Answers
Answer: Information Support and Services
Explanation:
The information support and services personnel covers the following job specification; information technology deployment which entails the implementation of computer systems and software, database management, provision of technical assistance related to computer systems and managing of information systems.
Since Olivia is able to set up her mother's computer network in her business, she can look into Information Support and Services because it covers the field for that
An architect’s functions may include which of the following? (SELECT ALL THAT APPLY.)
-planning and designing houses, commercial buildings, and other structures
-ensuring worksite safety
-collaborating with engineers
-acting as a construction manager and supervising contractors
Answers
Answer:
the answer is planning, ensuring, and acting
What is an advantage of investing pre-tax dollars in a retirement account?
Answers
One advantage of investing pre-tax dollars in a retirement account is that it can lower your taxable income in the year you make the contribution.
By reducing your taxable income, you also lower your tax bracket, which can have a significant impact on the amount of taxes you pay. Additionally, since the investment grows tax-free within the account, you can potentially accumulate more savings over time, as compared to investing in a taxable account. Another advantage is that many retirement accounts offer tax-deferred growth, meaning that you do not have to pay taxes on any investment gains until you withdraw the funds in retirement. This can result in a larger nest egg, since you are able to reinvest the earnings and allow them to grow tax-free for many years. Overall, investing pre-tax dollars in a retirement account can help you save on taxes, accumulate more savings, and potentially increase your retirement income.
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A transcript should be requested from—-
the post office
your references
former employers
past schools you have attended
Answers
Answer:
Past Schools you have attended
Explanation
The profile of an entrepreneur typically includes all of the following EXCEPT a(n) Select one: a. focus on concrete results. b. willingness to take risks. c. appreciation for the status quo. d. desire to assume responsibility. e. need for achievement.
Answers
The profile of an entrepreneur typically includes all of the following EXCEPT a(n): c. an appreciation for the status.
Who is an entrepreneur?An entrepreneur can be defined as someone who engages in trading or business.
The profile of an entrepreneur typically includes all of the following:
Focus on concrete results.Willingness to take risks.Desire to assume responsibility.Need for achievement.Therefore the correct option is c.
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I give you a 1000 dollars, you invest in the a stock that gets 10 percent interest yearly, after 3 years how much money will you have??
Answers
If the initial deposit is $1000 with 0 annual contributes and the invested time span is 3 years. Now you will have $1000 with $100 interest in 2023 you will have $210 interest in 2024 you will have $331 interest and by 2025 you will have $465 interest
2022 $1100
2023 $1210
2024 $1331
2025 $1465
Elijah and Aneesha are farmers. Each one owns an 18-acre plot of land. The following table shows the amount of watermelon and zucchini each farmer
can produce per year on a given acre. Each farmer chooses whether to devote all acres to producing watermelon or zucchini or to produce watermelon
on some of the land and zucchini on the rest.
Answers
Aneesha can also produce a total of 72,000 lbs of watermelon and 14,400 lbs of zucchini.
What is the total produce?Generally, Watermelon (lbs/acre) | Zucchini (lbs/acre)
------------------------|--------------------
4,500 | 800
If Elijah and Aneesha both choose to grow both watermelon and zucchini, Elijah can produce a total of 72,000 lbs of watermelon (4,500 x 18 acres) and 14,400 lbs of zucchini (800 x 18 acres).
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a top-level manager is most likely to solve problems under which condition?
Answers
A top-level manager is most likely to solve problems effectively when they have access to accurate and comprehensive information,
A broad understanding of the organization's goals and strategies, strong analytical and decision-making skills, and the authority to implement necessary changes. Additionally, when there is a supportive and collaborative work environment that encourages open communication and participation from team members, the manager can leverage diverse perspectives and expertise to find innovative solutions. Furthermore, when the manager possesses strong leadership qualities, such as the ability to inspire and motivate their team, they can foster a culture of problem-solving and drive effective problem resolution.
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according to obra, what is the minimum number of employees required to constitute a large group?
Answers
According to Obra, a minimum of 100 employees is required to constitute a large group.
Small groups include businesses with two to fifty full-time employees. For major organizations, more than 50 individuals work full-time.
Businesses with less than 200 employees frequently mandate that all parents enroll their kids. Part-time employees are not eligible for group health insurance. Even so, you can be qualified for employee health insurance if your company has less than 7 employees, but the bulk of them are employed part-time.
Small company health insurance is only available to businesses with between one and 50 employees. It qualifies as a small business for the purpose of receiving group health insurance. If you have more than 50 employees, you should apply for huge group insurance.
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We have this project in my business class, we have to come up with a store/business. I choose a candy store but I can’t think of any fine names. Can someone help me come with a name please?
Answers
Answer:
Candy Crush
Explanation:
Its catchy
Answer:
The Sweete Shoppe
The Lolly Pop
50 Shades of Candy
Explanation:
If any of you are having problems we can talk go ahead let everything out i'll help you!
Answers
Answer:
thank you !
Explanation:
i might need to use thins soon haha
thanks,
~mina
match the name to the letter indicating the functional business area within the enterprise system finance
Answers
Enterprise applications are systems that have cross-functional boundaries, concentrate on carrying out business operations throughout the whole corporate organization, and include all management levels.
Enterprise applications are systems that have cross-functional boundaries, concentrate on carrying out business operations throughout the whole corporate organization, and include all management levels. By tightly synchronizing their business operations, enterprise apps enable firms to become more adaptable and productive.
Four main corporate apps are as follows:
Business systemsSystems for managing the supply chainSystems for managing customer relationshipsInformation management techniquesEach of these enterprise applications combines a related set of operations and business procedures in order to improve organizational performance overall.
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Samantha keeps $1,000 in her checking account. A friend has suggested that she move that money into a savings account which pays interest and that she apply for a debit card on that savings account so that she can spend money in her account directly with merchants without having to write a check. What's wrong with this idea
Answers
Answer:
Few banks will issue debit cards for savings accounts since the law limits the use of a debit card with merchants to 6 times per month.
which of the following is most liquid? savings deposits checking deposits credit cards small time deposits money market mutual funds
Answers
Money market mutual funds are the most liquid option out of the given choices. Liquidity refers to the ease and speed with which an asset can be converted into cash without losing its value. In this context, the most liquid option is the one that can be easily and quickly converted into cash with the least amount of loss in value.
Savings deposits and checking deposits are also considered liquid options, but they may have withdrawal limits or require advance notice for larger withdrawals. While credit cards allow for easy and instant transactions, they are not considered a liquid option as they involve borrowing money that needs to be repaid later with interest.Small time deposits are less liquid compared to savings and checking deposits because they often require a penalty for early withdrawals.
Money market mutual funds, on the other hand, invest in highly liquid short-term debt securities such as Treasury bills, commercial paper, and certificates of deposit. These funds can be easily bought or sold at any time, making them the most liquid option out of the given choices.Overall, the liquidity of an option should be considered based on individual needs and circumstances, as different options may be more suitable for different situations. To determine which of the following is the most liquid, let's analyze each option: savings deposits, checking deposits, credit cards, small time deposits, and money market mutual funds. Assess each option's liquidity Savings deposits: Quite liquid; can be withdrawn easily but may have limits on withdrawals, Checking deposits: Highly liquid; can be withdrawn or used for payments without restrictions, Credit cards: Not a form of liquidity; they represent a line of credit rather than actual funds. Small time deposits: Less liquid; have a maturity date and may face penalties for early withdrawal. Money market mutual funds: Fairly liquid; can be withdrawn but might have some restrictions or fees.
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The primary goal of the marketing research process is to provide decision makers with knowledge that will help them solve problems or pursue opportunities.
a. true
b. false
Answers
The statement that "the primary goal of the marketing research process is to provide decision-makers with knowledge for problem-solving is:
A. True
What is marketing research?Marketing research refers to the series of inquiries that entrepreneurs must make to understand their customers and the approaches that will make them disposed to purchase their products. There are about five key steps to follow in this research process.
When all findings have been made, the last step of this marketing research process will be geared at helping the researcher evaluate the outcomes of the results and apply necessary controls at the appropriate ends.
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1 Jonah is employed as a joiner by a firm whose main business
activity is building houses. The firm also employs bricklayers,
plumbers, painters and other skilled tradesmen. Other factors
of production are used when building houses. The owner of
the firm, Jack, believes that specialisation of labour brings
many benefits to the business and its employees.
In his spare time, Jonah makes wooden toys which his sister
sells on her stall at the local market. He buys the wood and
other resources from a local supplier. The wooden toys have
been so successful that Jonah has decided to leave his job
as a joiner to set up his own toy-making business.
a
Identify two stages of business activity.
b Define 'opportunity cost'.
c Identify four factors of production.
d
Explain two ways Jonah could add
value to his toys.
[2]
[2]
[4]
[6]
e Do you agree with Jack that 'specialisation of labour
brings many benefits to the business and its employees'?
Justify your answer.
[6]
Answers
a) The business existence cycle is the progression of a commercial enterprise in phases over time and is most typically divided into 5 stages: launch, growth, shake-out, maturity, and decline.
b) Opportunity fee is the forgone advantage that would have been derived from an alternative no longer chosen. To proper evaluate chance costs, the charges and advantages of each choice available should be viewed and weighed in opposition to the others.
c) In economics, factors of manufacturing are the resources humans use to produce goods and services; they are the constructing blocks of the economy. Economists divide the factors of manufacturing into 4 categories: land, labor, capital, and entrepreneurship.
e) Yes, I am agree. the owner of ther firm, jack believes that specialisation of labour brings many benefit to the commercial enterprise and its workers. in his spaee time johan makes timber toys which his sister sells at her stall at the nearby market.
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Why is there a need to compare and align your pecs with the pecs of a successful entrepreneur?.
Answers
PECs, or Personal Entrepreneurial Competencies, are what you need to compare and align with the pecs of a successful entrepreneur.
It is described as those skills or character traits that a successful entrepreneur must possess. The likelihood of someone succeeding as an entrepreneur increases with the degree to which they exhibit these qualities.
An entrepreneur is a person who starts a new business, taking on the most of the risks and reaping the majority of the gains. The term Competencies "entrepreneurship" refers to the act of starting a business. The entrepreneur is frequently viewed as an innovator, a source of novel concepts, products, services, and/or business models.
In any economy, entrepreneurs play a crucial role because they have the knowledge and drive to foresee demands and market valuable new ideas. Profits, notoriety, and prospects for ongoing expansion are given to entrepreneurialism that succeeds in assuming the risks involved in Competencies founding a startup. Failure in entrepreneurship costs the participants money and reduces their visibility in the market.
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A newspaper headline writer found that the more adjectives she put in the titles of her articles, the greater the number of newspapers that were sold that day. This relationship between numbers of adjectives and newspaper sales must be:
Answers
Answer:
Positive.
Explanation:
A linear function has a positive relationship and as such an increase in one variable (input variable) causes an increase in the other variable (output variable) i.e the variables are directly proportional. Thus, the graph of a linear function is a straight-line and its slope is always constant.
On the other hand, nonlinear function has a negative relationship and as such an increase in one variable (input variable) causes a decrease in the other variable (output variable) i.e the variables are inversely proportional.
This ultimately implies that, the graph of a nonlinear function is a curved line and whose direction is constantly changing
In this scenario, the relationship between numbers of adjectives and newspaper sales must be positive because the higher the amount of adjectives put in the titles of her articles, the greater the number of newspapers that would be sold on a particular day.