Suppose that the market equilibrium price for a medical check-up is $50, in a market in which there is no health insurance. To e
ncourage more people to get a check-up, the local government indicates that the price of a check-up cannot be more than $40
a. Is this a price floor or a price ceiling?
b. Draw a graph to illustrate the implementation of the policy.
c. What happens to the number of check-ups in the market? Show on your graph.
d. What happens to consumer surplus in the market? What happens to producer surplus?
a. Is this a price floor or a price ceiling?
b. Draw a graph to illustrate the implementation of the policy.
c. What happens to the number of check-ups in the market? Show on your graph.
d. What happens to consumer surplus in the market? What happens to producer surplus?
1 answer:
Answer:
a. Price ceiling
b. see graph
c. Increases
d. Increases, decreases
Explanation:
a. Price ceiling is the maximum price or ceiling so to speak imposed by government for a particular commodity inorder to relieve purchase burden from the consumers.
b. Take note of the price ceiling in the graph attached.
c. Number of demanded check-ups increases, since they are now more affordable.
d. Consumer surplus increase by $10, while the producer surplus decrease by $10 ($50-$40).
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Answer:
$52,285
Explanation:
The computation of the total manufacturing cost assigned to Job P is shown below:-
Total manufacturing cost = Direct material + Direct labor + Manufacturing overhead applied
= $13,000 + $21,000 + (2,300 × $7.95)
= $13,000 + $21,000 + $18,285
= $52,285
Therefore for computing the total manufacturing cost assigned to Job P we simply applied the above formula.
