The balance of the price in the market is determined by demand and supply, which are measured in terms of the price and quantity variables; When a tax is placed on a product, a change in the market equilibrium is generated, since buyers pay more and sellers receive less.
Thus, a tax causes the supply curve to move up and the demand curve to move down.
In order to know how the tax burden is distributed, the incidence is measured through the elasticity of the supply and demand curve, which measures the sensitivity of the quantity, demanded or offered, of products before a price change.
When the supply curve is more elastic than the demand curve, the impact of the tax is stronger for consumers, as the prices paid by consumers increase more than the price that sellers receive decreases.
Answer
It can be concluded about the elasticity of demand and supply prices that <em>supply is more elastic than demand</em>
Answer:
C. the period of time in which at least one factor of production is fixed.
Explanation:
- The short-run is a condition, were some controls and market are not in fair equilibrium, some factors like the variables and other that are foxed have limited entry or exit to the industry.
- In the macroeconomics a long run is a time when the general price, and contractual wage rates, along with the expectations are adjusted entirely to the states of the economy. and this contrast to the short-run where the variable is not fully fixed or adjusted.
- <u>The short-run for a firm will increase the production of the marginal costs is less than the marginal revenue. The transition from the short to the long-run market equilibrium may be done on considering the supply and demands.</u>
Answer:
Ending inventory will be lower if Blake uses the weighted-average rather than the FIFO inventory cost flow method.
Explanation:
Ending inventory will be lower if Blake uses the weighted-average rather than the FIFO inventory cost flow method.
True as under weighted average:
(17 + 18) / 2 = 17.50
the ending inventory will be one unit valued at $17.50
while under FIFO the 17 dollar unit was sold and declare cost
while the second is keep under ending invenotry at $18.00
Answer:
the marginal propensity to consume is 0.75
Explanation:
The computation of the marginal propensity to consume is shown below:
MPC = Change in consumption ÷Change in disposable income
where,
The Change in consumption is 1500
ANd, the Change in disposable income is 2000
So,
MPC is
= $1,500 ÷ $2,000
= 0.75
hence, the marginal propensity to consume is 0.75
