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3 years ago

Suppose that in a competitive market without government regulations, the equilibrium price of a hamburger is $7 each.

Business

2 answers:

Norma-Jean [14]3 years ago

4 0

Answer:

Price Ceiling regulations prohibit the price of a good or service from being higher than a set price known as the Price Ceiling.

Price Floor regulations prohibit the price of a good or service from being lower than a set price known as the Price floor.

When either Price Ceiling or Floor is said to be nonbinding, it means that it does not affect the market/ equilibrium price of the good or service.

Binding Ceilings or Floors affect the market/ equilibrium price.

Due to new regulations, fast-food restaurants that would like to pay better wages in order to hire more workers are prohibited from doing so. <u>BINDING PRICE CEILING.</u>

The Fast-food restaurants cannot pay above a certain amount which makes this a Price Ceiling. It is binding because the Market wants to pay higher wages to hire more people but cannot therefore the price ceiling is having an effect on the equilibrium price.

The government prohibits fast-food restaurants from selling hamburgers for more that $5 each.<u> BINDING PRICE CEILING.</u>

Fast-food restaurants are not allowed to sell above the set price of $5 which makes this a price ceiling. It is Binding because the equilibrium price is $7 which means that fast-food restaurants are forced to sell below the equilibrium price therefore this Price ceiling affects the equilibrium price.

Hoochie [10]3 years ago

3 0

Answer:

See Below..

Explanation:

1. Due to new regulations, fast-food restaurants that would like to pay better wages in order to hire more workers are prohibited from doing so.

Price Ceiling and Binding

In the labor market, minimum wage laws are an example of a price floor while a cap on wages is an example of a price ceiling. Moreover, the impact of the minimum wage laws depends on the skill and experience of the worker. In this case, new regulations restrict fast-food restaurants from increasing wages and, thus, attracting more workers. This binding price ceiling causes a shortage of workers in this labor market.

2. The government prohibits fast-food restaurants from selling hamburgers for more that $5 each.

Price Floor and Binding

A price ceiling is a legal maximum on the price at which a good can be sold. Therefore, prohibiting fast-food restaurants from selling hamburgers for more than a particular price is an example of a price ceiling. A binding price ceiling is a price ceiling that is set below the equilibrium price. Because the equilibrium price is $7 each for hamburgers, a legal maximum price of $5 is a binding price ceiling. A binding price ceiling will ultimately cause a shortage, while a non-binding price ceiling has no effect on the equilibrium price and quantity.

Hope this helped you!

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Grace Food Company Contribution Income Statement for the Month of October Corn Flakes Frosted Flakes Total Amount Percent Amount

ivann1987 [24]

Answer:

$1.5 million.

Explanation:

Calculation of the amount of the break-even sales for Grace Food Company:

Sales mix calculation will be:

Corn Flakes = $2,000,000/$2,500,000

= 0.80,

Frosted Flakes = $500,000/$2,500,000

= 0.20.

Calculation for the Contribution margin ratio will be:

(60%) × (0.80) + (50%) × (0.20) = 58�lculation for the Break-even point will be:

Break even point= Total Fixed Costs/Overall Contribution margin ratio

Hence,

$870,000/0.58= $1.5 million.

Therefore amount of break even sales will be $1.5 million.

8 0

3 years ago

ken and sue are purchasing a home but are short on the down payment required by their lender. sue's mother offered to give them

aleksandrvk [35]

She is permitted, according to the applicable tax legislation, to donate $30 000.

This is further explained below.

<h3>How much can Sue's mother give under current tax laws?</h3>

In most cases, Sue's mother is able to pay Ken the first fifteen thousand dollars and then proceed to give Sue the remaining fifteen thousand dollars. Because Sue's mother gave this to her, there will be no tax placed on it because it is considered a gift.

The act or process of passing tax laws, as well as the body of laws that allow for the levying of taxes and the administration of taxes, are together referred to as tax legislation.

Any object or document that is verifiable and that is frequently accepted as payment for goods and services as well as the repayment of obligations, such as taxes, in a given nation or socio-economic setting is considered to be money in that nation.

In conclusion, Sue's mother and father could give Ken and Sue a gift of $15,000 each, bringing the total amount of money they give to each of them to a grand total of $60,000 each.