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melisa1 [442]
3 years ago
10

14. A 2015 article published by the American Journal of Preventive Medicine studied the effects of an increase in alcohol prices

on the incidence of new cases of sexually transmitted diseases. In particular, the researchers studied the effects that a Maryland policy increasing alcohol taxes had on the decline in gonorrhea cases. The report concluded that an increase in the alcohol tax rate by 3% resulted in 1,600 fewer cases of gonorrhea. Assume that prior to the tax increase, the number of gonorrhea cases was 7,450. Use the midpoint method to determine the percentage decrease in gonorrhea cases, and then calculate the cross-price elasticity of demand between alcohol and the incidence of gonorrhea. According to your estimate of this cross-price elasticity of demand, are alcohol and gonorrhea complements or substitutes?
Business
1 answer:
True [87]3 years ago
4 0

Answer:

a) Cross elasticity = -8.02

b) these are complementary items because the cross elasticity of gonorrhea and alcohol is less than 1.

Explanation:

Cross Price Elasticity is calculated using the following formula

[(Q2-Q1) / (Q2-Q1/2)]  /  [(P2-P1)/ (P2-P1/2)]

The meaning of the formula is the change in the quantity demanded of a good divided by the percentage change in the price of another good or product.

In this case we are comparing how the demand for alcohol affects the occurrence of gonorrhea.

1) We determine the change in the issues of gonorrhea.

The initial cases of Gonorrhea Q1 is 7,450 but it later reduced by 1600 due to an increase in alcohol price by 3%

Q2 = 7,450-1600= 5,850

Q1= 7,450

Plugging this into the formula we determine the percentage of decrease in gonorrhea.

= [(Q2-Q1) / (Q2-Q1/2)]

= (5850-7540)  / (5850-7450 /2)

= -1600/6,650 x 100

= -24.06%

2) We already know the change in the price of Alcohol to be 3% increase due to tax

<u>Hence, the cross elasticity of the two as given in the formula above</u>

= The percentage change in the cases of gonorrhea / the percentage change in the price of alcohol

= -24.06% / 3%

= -8.02

Also, these are complementary items because the cross elasticity of gonorrhea and alcohol is less than 1.

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The correct answer to this open question is the following.

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3 years ago
Which organization does not provide free or loss cost training and counseling associated with the Small Business Association
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The organization that does not provide free or loss cost training and counseling associated with the Small Business Association is IBRD.

<h3>What is Small Business Association?</h3>

A Small Business Association are agencies that provides resources (like capital, skill, advice) to small businesses for innovation, growth etc

SCORE, VBOC and WBC are all agencies that provide free mentoring services, free training, loss-cost training, counseling etc

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Therefore, the Option A is correct.

Read more about Small Business Association

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2 years ago
Marriott International is a worldwide operator, franchisor, and licensor of hotels, residential, and timeshare properties totali
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Journal Entries:

a. $300,000 cash

Debit Sale of Assets $8,000,000

Credit Furniture $8,000,000

To transfer the account to sale of assets account.

Debit Accumulated Depreciation $7,700,000

Credit Sale of Assets $7,700,000

To transfer the account to sale of assets account.

Cash $300,000

Sale of Assets $300,000

To record the cash receipts from the sale of assets.

No gain or loss on disposal.

b. $900,000 cash

Debit Sale of Assets $8,000,000

Credit Furniture $8,000,000

To transfer the account to sale of assets account.

Debit Accumulated Depreciation $7,700,000

Credit Sale of Assets $7,700,000

To transfer the account to sale of assets account.

Debit Cash $900,000

Credit Sale of Assets $900,000

To record the cash receipts from the sale of assets.

Sale of Assets $600,000

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To record the gain on the disposal of the furniture.

c. $100,000 cash

Debit Sale of Assets $8,000,000

Credit Furniture $8,000,000

To transfer the account to sale of assets account.

Debit Accumulated Depreciation $7,700,000

Credit Sale of Assets $7,700,000

To transfer the account to sale of assets account.

Debit Cash $100,000

Credit Sale of Assets $100,000

To record the cash receipts from the sale of assets.

Loss on Disposal $200,000

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To record the loss on disposal of the furniture.

2. The disposal of an asset creates either a loss on disposal or a gain on disposal, which is normally regarded as a capital loss or a capital gain, as the case may be.

Explanation:

a) Data and Calculations:

Furniture (cost) ............................... $8,000,000

Accumulated depreciation .............. ...7,700,000

Net book value = $300,000

a. $300,000 cash

Sale of Assets $8,000,000

Furniture $8,000,000

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Furniture $8,000,000

Accumulated Depreciation $7,700,000

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