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stiv31 [10]
3 years ago
7

Suppose a new​ off-campus university apartment complex could rent its rooms on the open market for​ $900 a month. ​If, instead,

the university chooses to cap the price of rooms to​ $500 a month for​ students, the result would be that
Business
1 answer:
asambeis [7]3 years ago
3 0

Answer:

a shortage would arise since quantity demanded would exceed the quantity supplied

Explanation:

The law of demand states an inverse relationship between price of a good and it's demand.

In the given case, per month rental for rooms has significantly reduced for students. This would result into an immediate increase in demand for the rooms. Now since, the rooms available are limited in number, a shortage would arise.

Owing to such a shortage, a possibility would arise wherein students who do not require such rooms may avail such rooms at $500 and subsequently let out the rooms to outsiders at anything below $900 thereby earning a profit.

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False should be the answer
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4 0
3 years ago
Read 2 more answers
Which of the following is part of the M2 definition of the money supply, but not part of M1?
STALIN [3.7K]

Answer:

The answer is b

Explanation:

Demand for money is the situation in which money are held in cash form without spending it. The demand for money is a derived demand in the sense that people do not spend all their salaries when they receive it at the end of the month. The portion of their salaries which they do not spent immediately they are received is what we referred to as the demand for money. There are three reasons for holding money which are

Transaction motive :This is the desire to keep money in order to meet the day to day transaction of business such as buying of foodstuff and to meet other family need .

Precautionary motive : This is the desire to keep money in order to meet the unforseen circumstances which are not planned for but which immediately occur, such as sickness, unexpected visitors, breakdown of one's car,

Speculative motive :This is the desire to keep money with the hope of using the money in making quick money. It is a money held with the hope of giving it out in form of loan if the interest is high and at a short period of time.for instance purchasing shares at a lower prices and re-selling it at higher prices .it also includes buying goods at a lower prices and re-selling at a higher prices for example cars.

7 0
3 years ago
In December 2014, Todd, a cash basis taxpayer, paid $1,200 fire insurance for the calendar year 2015 on a building he held for r
Kamila [148]

Answer: D. Todd should include the $500 in 2015 gross income in accordance with the tax benefit rule.

Explanation:

It should be noted that due to the fact that Todd is a cash basis taxpayer, he'll be able to deduct the one-year prepayment for insurance in the year that it was paid, 2014.

In this case, he deducted $1,200, then his net cost will be ($1200 - $500) = $700. In this case, Todd should then include the $500 refund in gross income for 2015 under the tax benefit rule.

7 0
3 years ago
A firm has 12,000 shares of common stock outstanding with a book value of $20 per share and a market value of $39. There are 5,0
lana [24]

Answer:

13.7%

Explanation:

The weight to be placed on preferred while computing the company's weighted average cost of capital (WACC) is the market value of the preferred stock divided by the market value of the company as a whole.

market of preferred stock=5,000*$26=$130,000

Market value of the company=market value of common stock+market value of preferred stock+market value of bond

common stock market value=12,000*$39=$468,000

market value of bond=$400,000*87%=$348,000

Weight of preferred stock=$130,000 /($130,000 +$468,000+$348,000)=0.137420719 =13.7%

6 0
3 years ago
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