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Stolb23 [73]
3 years ago
7

Suppose that, in a competitive market without government regulations, the equilibrium price of donuts is $1.50 each. Complete th

e following by indicating whether each of the statements is an example of a price ceiling or a price floor and whether it is binding or nonbinding.
a. The government has instituted a legal minimum price of $1.80 each for donuts.
b. Due to new regulations, donut shops that would like to pay better wages in order to hire more workers are prohibited from doing so.
c. The government prohibits donut shops from selling donuts for more than $1.10 each.
Business
1 answer:
statuscvo [17]3 years ago
4 0

Answer:

Option A is a price floor, option B is binding and option C is price ceiling.

Explanation:

It is stated that the equilibrium price of a donut is $1.50.

If the government institutes a legal minimum price of $1.80 for a donut, that would be an example of price floor because the price cannot be lower than that. $1.80 is higher than $1.50 so it serves a purpose.

Option B is binding since any donut shop that wants to pay better wages is prohibited from hiring more workers.

The government prohibiting donut shops from selling a donut for more than $1.10 is an example of floor ceiling because the price can not go higher than $1.10.

I hope this answer helps.

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Tangshan Mining​ Company, with a cost of capital of 10​ percent, is considering investing in project​ A, with an initial investm
alexdok [17]

Answer:

the breakeven cash inflow for the project is $131474

Explanation:

given data

cost of capital = 10​ percent

initial investment =​ $1,000,000

useful life = 15 year

to find out

the breakeven cash inflow for the project

solution

first we consider here annual cash inflows that is =  x

now break even point is the one at which the net present value of the project  =  0

so we can say that here  

Present value of cash inflows - Present value of cash outflows = 0   .................1

here we know Present value of cash inflows = x  × PVAF ( 10%,15 years)

Present value of cash inflows = x  ×  7.6060

put value in equation 1 we get

x  ×  7.6060 - $1,000,000  = 0

solve and we get x

x = \frac{1,000,000}{7.6060}

x = $131474

so the breakeven cash inflow for the project is $131474

7 0
4 years ago
Suppose you take out a 30-year mortgage for $100,000 with annual payments. The interest rate on the mortgage is 8%. When you hav
Elza [17]

Answer:

Approximately 8 more payments need to be made.

Explanation:

Mortgage Amount = $100,000

Interest Rate = 8%

Time = 30 years

Calculating Annual Payment,

Using TVM Calculation,

PMT = [PV = 100000, T = 30, FV = 0, I = 0.08]

PMT = $8,882.74

So,

Annual Payment = $8,882.74

Loan Balance = $50,000

Calculating Time for Repayment,

Using TVM Calculation,

T = [PV = 50,000, PMT = -8882.74, FV = 0, I = 0.08]

T = ~8 years

6 0
3 years ago
Jinhee purchased a ticket to a concert to raise money for the local university. The ticket cost $250, but the normal cost of a t
jolli1 [7]

Answer:

Amount deductible as a charitable contribution=$175.

Explanation:

Given data:

Cost at which the ticket is purchased=$250

Actual cost of the ticket=$75

Required:

Amount deductible as a charitable contribution=?

Solution:

Any amount above the fair market value/Normal value will be the deductible charitable contribution.

In our case:

Amount deductible as a charitable contribution=Cost at which the ticket is purchased - Actual cost of the ticket.

Amount deductible as a charitable contribution=$250-$75.

Amount deductible as a charitable contribution=$175.

8 0
3 years ago
The author of article "The Pentagon’s Virtuous Insurgency" asserts that there are four key takeaways from the conference discuss
r-ruslan [8.4K]

Answer and explanation:

Here is one of the key notes,

Even the Department of Defense recognizes that getting things done quickly now requires working around the system.

From the article it was stated that bureaucratic processes are agonizingly slow and this problem is being addressed by new defense department organization. These two organizations are the Defense Digital Service and Defense Innovation Unit Experimental.

5 0
4 years ago
Suppose you build a model of the market for umbrellas, in which the predicted number of umbrellas sold by a shop depends on thei
SVETLANKA909090 [29]

Answer:

Quantity, location and weather

Explanation:

The concept of the ceteris paribus, is vital in economics as in the real world, it is generally hard to isolate all the variables that are different, and might change the result or outcome.

The ceteris paribus is the simplification, which include holding other things ( both outside as well as inside the model) constant. In this situation, all variables except price and the color are held constant. In this example, such as quantity, weather and location are held constant.

8 0
3 years ago
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