Explanation:
Normal goods are the whose demand decreases with increase in price whereas in economics inferior goods are those whose demand decreases with increase in people's income.
Normal goods have a positive income elasticity of demand; as incomes rise, more goods are demanded at each price level.Inferior goods have a negative income elasticity of demand; as consumers' income rises, they buy fewer inferior goods.
Answer:
Answer for questions 1 and 3:
If the total demand for a product increases, the demand curve will shift to the right, which will result in a price increase at every quantity demanded. Since the price of the product will increase, the suppliers will be making a higher economic profit. this in turn will make existing firms increase their total output, and other firms enter the market and start their own production. You must remember that on a competitive market with no entry barriers, the competing firms have $0 economic profit (not the same as accounting profit).
Answer for question 2:
If the government imposes a price ceiling and it is lower than equilibrium quantity, then the firms' profits will decrease, which in turn will reduce their incentive to increase their output and it will also decrease the number of new firms entering the market. This will produce a deadweight loss resulting from a shortage of products that which will negatively affect customers.
Answer:
the answer is a demand curve
Explanation:
Answer: $12
Explanation:
In selling the obsolete goods, the company will incur Variable Marketing costs and the alternative will be to throw the goods away.
The relevant costs they will incur are therefore the Variable Marketing costs alone.
The lowest amount that a company should accept for a good is the price that equals it's cost so that they may at least Break-Even.
Seeing as the Variable Marketing Costs are the only relevant cost then the lowest they should accept is the Variable Marketing Costs of $12.
Answer:
Instructions are listed below
Explanation:
Giving the following information:
Channing uses a two-stage cost allocation system, It uses direct-material costs to allocate direct-materials related overhead and direct labor costs to allocate direct-labor related overhead costs.
A1
Direct material 75,000
Direct labor 58,000
B2
Direct material 150,000
Direct labor 137,750
Overhead:
Direct-material related 54,000
Direct-labor related 50,895
A) Estimated manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Estimated manufacturing overhead rate= 225,000/54000= 4.17 per direct material
B) Estimated manufacturing overhead rate= 195,750/50895= 3.85 per direct labor
C) Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Allocated MOH (A1)= 4.17*75000 + 3.85*1377550= 843,087.5
D) Allocated MOH (B2)= 4.17*54000 + 3.85*50895= 421,125.75
