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3 years ago

What do the income effect, the substitution effect, and diminishing marginal utility have in common?

Business

1 answer:

Sveta_85 [38]3 years ago

3 0

Answer:

They all help explain the downsloping demand curve

Explanation:

The options to the question wasn't provided. The complete question can be in the attached image.

The demand curve slopes downward from left to right. This indicates that the higher the price, the lower the quantity demanded and the lower the price, the higher the quantity demanded.

Income effect is a change in quantity demanded when real income change. Quantity demanded increases when real income increases and decreases when real income falls.

Substitution effect says that consumers would substituite to the consumption of a cheaper good when the price of a good originally consumed increases.

Diminishing marginal utility states that as consumption increases, utility derived from consumption falls and quantity demanded falls.

I hope my answer helps you

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EBay A. is a market because buyers and sellers are brought together to buy and sell. B. cannot function as a market. C. would be

IgorLugansk [536]

Answer:

A. is a market because buyers and sellers are brought together to buy and sell.

Explanation:

The definition of market is that it is a place where sellers of products and services meet with potential buyers. Acording to this definition, Ebay can be considered a market because in this website there are sellers offering different types of products and buyers willing to pay in order to get them.

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3 years ago

Santayana Company purchased a machine on January 1, 2011, for $20,000 with an estimated salvage value of $5,000 and an estimated

Aliun [14]

Answer:

$1,125

Explanation:

Given that,

Cost of machine = $20,000

Estimated salvage value = $5,000

Estimated useful life = 8 years

Depreciation refers to the reduction in the value of the fixed assets of a particular company with the passage of time.

Here, we are using the straight line method,

Annual depreciation is as follows:

= (Cost of machine - Salvage value) ÷ Estimated useful years

= ($20,000 - $5,000) ÷ 8

= $1,875

Depreciation amount for the year 2011 = $1,875

Depreciation amount for the year 2012 = $1,875

Therefore, the book value of the machine at the beginning of January 1, 2013 is as follows:

= Cost of machine - Depreciation amount for the year 2011 - Depreciation amount for the year 2012

= $20,000 - $1,875 - $1,875

= $16,250

Now, the Santayana decides the machine will last 12 years from the date of purchase and we have already deduct the depreciation for the 2 years. So, we need to consider only 10 years for calculating the new annual depreciation.

Salvage value remains the same.

New annual depreciation:

= (Book value at the beginning of 2013 - Salvage value) ÷ Useful life

= ($16,250 - $5,000) ÷ 10

= $11,250 ÷ 10

= $1,125

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Answer:

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2 years ago

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Answer:

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Explanation:

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2 years ago