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3 years ago

Deadweight loss occurs when

Business

1 answer:

dusya [7]3 years ago

3 0

Answer:

d) the maximum level of total welfare is not achieved.

Explanation:

When the economic efficiency bears a loss, it is termed to be a deadweight loss. This condition occurs in the situation when the free market equilibrium is not able to be achieved. It occurs in the economy when the supply and the demand for the goods and services start to fall from being in the state of equilibrium. The resources allocated experiences a deficiency, thereby causing a deadweight loss.

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Banks Company sold merchandise on account for $35,000 with terms 2/10, n/30. The cost of goods sold was $27,600. If the invoice

WITCHER [35]

Answer:

The amount of cash received by Banks Company is $34,300

Explanation:

The computation of the cash received by the bank company is shown below:

= Merchandise amount - discount

where,

Merchandise amount is $35,000

And, the discount equal to

= Merchandise amount × discount percentage

= $35,000 × 2%

= $700

Now put these values to the above formula

So, the value would equal to

= $35,000 - $700

= $34,300

3 0

4 years ago

An establishment has three departments with variable costs as a percentage of sales revenue of 30 percent, 40 percent, and 50 pe

zalisa [80]

Answer:

60 percent

Explanation:

Contribution margin refers to the revenue a firm derives after deducting the variable cost it has incurred.

Contribution margin = Sales - Variable costs

Contribution margin or contribution to sales ratio represents the percentage of contribution a firm earns from the sale of it's output.

It is represented mathematically as,

= $\frac{Contribution\ margin}{Sales}$

Also, contribution margin ratio = 100 - variable cost ratio percentage.

Hence, contribution margin for three departments would be:

A = 100 - 30% = 70%

B = 100 - 40% = 60%

C = 100- 50% = 50%

This represents if sales revenue is 100, contribution margin earned is 70, 60 and 50 under three cases.

Since sales revenue in all three departments is the same, let us assume the sales revenue of a department as y.

$\frac{0.70y\ +\ 0.60y\ +\ 0.50y}{3y}$

Thus, weighted average contribution margin would be, 60 percent

7 0

3 years ago

Discuss the differences between the short run equilibrium and long run equilibrium from the perspective of producers and from th

ehidna [41]

Answer:

In the long-run, the economy tends to favor consumers more than it favors producers.

Explanation:

This is because, in competitive market structures, firms earn economic profit only in the short-run, but in the long-run, this economic profit either disappears, or decreases substantially, because the structure of the market itself provides incentive for a dynamic flux of firms in and out of the industry, and economic profit moves along that flux: it goes up when the number of firm in the industry goes down, and it goes down when the number of firms in the industry goes up.

Managers should understand these dynamics in order to be able to forecast trends and act accordingly, mainly by developing corporate strategy that tackle the forecasted scenarios.

Finally, an example of a business affected by a fall in demand is airline companies. The airline market is very competitive even if it is dominated by a few firms due to very high barriers to entry and exit. Airline companies are constantly pressured to offer lower prices, while costs do not necessarily fall at the same rate. The recent demand shock due to the current pandemic has left most airlines in a dire condition, using up past reserves to operate, and frequently in need of government assistance.

3 0

3 years ago

Culver Company has four operating divisions. During the first quarter of 2017, the company reported aggregate income from operat

lana66690 [7]

Answer:

Income after discontinuing operations from both departments 1 and 2 is greateri.e. $ 207 444 than income after discontinuing operations from department 1 . i.e. $ 172964

Explanation:

Option 1:

If the 1st division is discontinued. 50 % of the fixed costs and expenses will continue and included in irrelevant costs.

Culver Company

Income Statement

For the 1st Quarter 2017

Division II III IV Irrelevant Costs

Sales $198,000 $499,000 $446,000

Cost of G. Sold 191,000 298,000 254,000

V. COGS 90 % 80 % 74 %

V.COGS 171,900 238,400 187960

FIxed COGs 19,100 59600 66,040 30690

Selling &

Administrative Exps 63,000 63,000 46,000

Var. S& Admin Exps. 62% 52% 58%

Var. S& Admin Exps. 39060 32760 26,680

Fixed S.& Admin Exps 23940 30240 19320 24346

Income (loss) $ (56,000) $138,000 $146,000

Total Income = $ (56,000)+$138,000+$146,000-30690- 24346

Total Income= $ 172964

Option 2:

If both the 1st and 2nd division are discontinued. 50 % of the fixed costs and expenses are added under the section II.

Culver Company

Income Statement

For the 1st Quarter 2017

Division II III IV Irrelevant Costs

Sales $499,000 $446,000

Cost of G. Sold 298,000 254,000

V. COGS 80 % 74 %

V.COGS 238,400 187960

FIxed COGs 9,550 59600 66,040 30690

Selling &

Administrative Exps 63,000 46,000

Var. S& Admin Exps. 52% 58%

Var. S& Admin Exps. 32760 26,680

Fixed S.& Admin Exps 11970 30240 19320 24346

Income (loss) $138,000 $146,000

Total Income = $138,000+$146,000-30690- 24346- 9,550 - 11970

Total Income= $ 207 444

We calculate the fixed and variable costs by multiplying with the given percentages and subtracting it from the total .

Culver Company

Income Statement

For the 1st Quarter 2017

Division I II III IV

Sales $250,000 $198,000 $499,000 $446,000

Cost of G. Sold 198,000 191,000 298,000 254,000

V. COGS 69 % 90 % 80 % 74 %

V.COGS 136,620 171,900 238,400 187960

FIxed COGs 61,380 19,100 59600 66,040

Selling &

Administrative Exps 74,900 63,000 63,000 46,000

Var. S& Admin Exps. 41% 62% 52% 58%

Var. S& Admin Exps. 30,709 39060 32760 26,680

Fixed S.& Admin Exps 48691 23940 30240 19320

Income (loss) $ (22,900) $ (56,000) $138,000 $146,000

3 0

4 years ago

Most state legislators are ________. Group of answer choices from the most popular families in the state more educated than the

taurus [48]

Answer:

Typical of a cross section of the population

Explanation:

Each state in the U.S have state legislators who are elected by the citizens of the states who are eligible to vote therefore most state legislators are a typical cross section of the population in the state that they are serving as a legislator in the state legislative arm of Government.

The state legislature helps in approving the budget, initiating impeachment processes and also deliberate issues brought to it by the Governor. the legislature initiates tax legislation in the states hence one can say the most state legislators represents the cross section of the population.

8 0

4 years ago