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Rama09 [41]
3 years ago
13

The following equations describe the supply and demand for crude oil in the United States in the mid-1980s: (Quantity supplied =

"S") (Quantity demanded = "D") S = -2 + (1/2)P S = 15 - (1/4)P Where price (P) is given in dollars and quantity in millions of barrels per day. The domestic equilibrium price is $22.67 per barrel with 9.3 million barrels traded per day. If the world price is below this equilibrium price, a domestic shortage will develop. We can deal with this shortage by purchasing crude oil from foreign suppliers. Determine the quantity of imports when the world price is $11.00 per barrel.
Business
1 answer:
irina [24]3 years ago
6 0

Answer: The equilibrium price is $68, Quantity 32 million barrel, The quantity to import is 53 million barrel

Explanation:

Given that D = -2 + (1/2)P, S = 15 - (1/4)P

At equilibrium Qd = Qs

-2 + (1/2)P = 15 - (1/4)P

Change 1/2 P and 1/4 P to decimal we have 0.5, and 0.25 respectively

Collect like terms

-2 -15 = 0.25P - 0.5P

17 = 0.25P

Divide both sides by P

17/0.25 = 0.25P /0.25

68 = P

P = 68

Substitute the value of P into equation 1 and 2 determine the value of Q

-2 + 0.5 (68)

-2 + 34

= 32

15 - 0.25 (68)

15 + 17

= 32

To determine the quantity to import when world price is $11.00 per barrel ,substitute the value into equation 1

-2 + 0.5 (11)

-2 + 55

= 53

Therefore quantity to import is 53 millions barrel

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Answer:

Zan Corporation

Production Department

Quarters                                1st            2nd           3rd          4th       Total

1. Raw materials              50,000g   62,000g  54,000g  44,000g 210,000g

  Purchased

2. Cost of purchases    $60,000   $74,400  $64,800  $52,800 $252,000

3. Total disbursement   $38,880  $68,640  $68,640   $57,520  $233,680

4. Direct labor costs      $11,500    $18,400    $16,100   $13,800    $59,800

Explanation:

a) Data and Calculations:

Forecast Production

Quarters                               1st            2nd           3rd            4th       Total

Units to be produced        5,000        8,000       7,000       6,000     26,000

Grams required               40,000g   64,000g  56,000g   48,000g 208,000

Beginning Inventory          6,000g    16,000g   14,000g    12,000g   6,000g

Raw materials purchase 50,000g   62,000g  54,000g   44,000g 210,000g

Ending Inventory             19,200g     16,800g   14,400g      9,600g

Cost of purchases        $60,000   $74,400  $64,800   $52,800  $252,000

Beginning Inventory cost  7,200     19,200      16,800      14,400

Total Cost of materials $67,200  $93,600   $81,600   $67,200

Cost of materials used $48,000  $76,800  $67,200   $57,600

Grams required by 1 unit        8 gm

Cost of 1 gm = $1.20

Ending Raw materials

25% of next quarter's  16,000gm    14,000gm  12,000gm  8,000gm

Accounts Payable

Beginning balance         $2,880

Cost of purchases       $60,000   $74,400  $64,800   $52,800  $252,000

Cash Disbursement for purchases of materials:

Cash Payment:                  1st            2nd           3rd            4th       Total

60% quarter acquired  36,000      44,640     38,880      31,600

40% in ffg quarter          2,880      24,000     29,760     25,920

Total disbursement   $38,880    $68,640  $68,640   $57,520  $233,680

Cost of direct labor:

Each unit requires 0.20 direct labor-hours at $11.50 per hour

Quarters                               1st            2nd           3rd            4th       Total

Units to be produced       5,000        8,000       7,000       6,000     26,000

Total direct labor-hours    1,000         1,600        1,400       1,200        5,200

Direct labor costs          $11,500     $18,400    $16,100   $13,800   $59,800

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