1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
horsena [70]
3 years ago
12

Consider the production of paper in Strelsau. Suppose that the supply of paper is upward-sloping and the demand for paper is dow

nward-sloping. Suppose that the production of paper causes a negative externality of $0.50 per ream (because the smell of the paper production process in this town is both strong and horrific), and the conditions outlined by the Coase theorem do not hold. By how much does the optimal price per ream of paper differ from the market price per ream of paper?
Business
1 answer:
ExtremeBDS [4]3 years ago
7 0

Answer: The optimal price is higher than market price by less than $0.50.

Explanation:

Since, it was given that Coase theorem doesn't hold in this situation, hence, the social marginal cost is greater than the private marginal cost by $0.50. The social marginal cost curve lies towards the left of demand curve.

Since the demand and supply curve are not perfectly elastic or inelastic, so the optimal equilibrium occurs at a point (price) which is greater than the prevailing market price, but the difference in the price is less than $0.50.

Therefore, the optimal price is higher than market price by less than $0.50.

You might be interested in
A ____ is drawn on a financial institution and is payable upon demand?
Molodets [167]

Answer: check

Explanation:

A <em>check</em> is drawn on a financial institution and is payable upon demand.

7 0
3 years ago
Read 2 more answers
The common stock of Alpha Manufacturers has a beta of 1.14 and an actual expected return of 15.26 percent. The risk-free rate of
Gre4nikov [31]

Answer: d. The actual expected stock return indicates the stock is currently underpriced.

Explanation:

According to CAPM, the expected return is:

= Risk free rate + beta * (market return - risk free rate)

= 4.3% + 1.14 * (12.01% - 4.3%)

= 13.09%

The actual expected return is greater than the CAPM expected return.

This stock is underpriced because it is bringing in a higher return than CAPM predicted based on the market.

8 0
3 years ago
A _____ is a document that outlines specific information about your proposed business, including product, location, and marketin
zhannawk [14.2K]

Answer:

D

Explanation:

5 0
2 years ago
Materials requirements planning (MRP) _________.a. reduces the uncertainty about when materials are needed, thereby reducing the
eimsori [14]

Answer:

The correct answer is (a)

Explanation:

Material inventory planning technique is an effective technique to manage the inventory level. It helps to manage all the inventory requirements and helps to schedule the inventory accordingly. It reduces the uncertainly regarding the inventory level, needs and materials. It helps to have the entire inventory needed for the short time; as soon as the inventory reaches a specific level it helps to restock it.

5 0
3 years ago
It costs $3000 to reserve a room, hire an instructor, and bring in the equipment. Assume it costs $25 per student for the admini
Anastaziya [24]

Answer:

&175

Explanation:

Breakeven price is the minimum price a product or service  must be sold to cover the cost of producing it. Its aim is to ensure that items are not sold at a loss.

In the scenario given ,

Cost of room reservation = $3000

Cost of room / student = $3000/20 = $150

Course materials per student = $25

Total cost of course materials = $25 * 20 =$500

Total cost of training = $3,500

Target attendees = 20

Breakeven price  = $3500/20 = $175

8 0
3 years ago
Other questions:
  • He type of company that sells securities specializing in real estate ventures, and requires a minimum of 100 investors, is known
    9·1 answer
  • Which professionals do not need to be licensed to engage in legal and enforceable contracts?
    6·1 answer
  • Chavez Corporation reported the following data for the month of July: Inventories: Beginning Ending Raw materials $ 31,000 $ 32,
    6·1 answer
  • Listening is often as important as speaking in a business conversation
    10·1 answer
  • A current liability is a debt that is reasonably expected to be paid a. out of cash currently on hand b. within one year c. out
    10·1 answer
  • A bond's current market value is equal to the present value of the coupon payments plus the present value of the face amount.a.
    12·1 answer
  • Danny "Dimes" Donahue is a neighborhood’s 9-year-old entrepreneur. His most recent venture is selling homemade brownies that he
    6·1 answer
  • When the CPI increases from 200 in 2016 to 210 in 2017 and the nominal wage rate is constant at​ $10 an​ hour, the real wage rat
    12·1 answer
  • What should you do when you use a ladder?
    7·2 answers
  • Which group is legally responsible for implementing
    6·2 answers
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!