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lapo4ka [179]
3 years ago
8

A large group of fans are upset about the high price of tickets to many events. As a result of their lobbying efforts, a new law

caps the maximum ticket price to any sporting event at $50. Assume there are a fixed amount of seats in the stadium, all seats are available to be sold, and the price of tickets before the ceiling was at an equilibrium point above $50.The price ceiling will create a ___________ of tickets, which will be greater if demand is more _______________, and _________ people will attend the events.
a. surplus; elastic; more
b. shortage; inelastic; fewer
c. shortage; elastic; the same number of
d. surplus; elastic; fewer
Business
2 answers:
Mashcka [7]3 years ago
7 0

Answer:

C. <u>shortage</u>; <u>elastic</u>; <u>the same number of</u>

Explanation:

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

Price elasticity of demand refers to the degree of responsiveness of quantity demanded to a change in price. When quantity demanded changes less relatively to change in price, it is termed as inelastic demand while when the change in quantity demanded is lot more than the change in price, it is termed as elastic demand.

In the given case, after the upper limit price has been capped and fixed, this would create a rush and tickets for the sports events would be sold off since the quantity demanded would rise.

This would result into a shortage since demand shall exceed supply and since the price cannot be raised above $50.

The more elastic the demand, more shortage of tickets it would result into and the same number of people will attend the events i.e the seating capacity is not increased.

Citrus2011 [14]3 years ago
3 0

Answer:

C) Shortage ; Elastic ; Same number of

Explanation:

Usual market are at equilibrium when : Market Demand = Market Supply. Upward sloping supply curve (due to law of supply) & Downward sloping demand curve (due to law of demand) intersect each other.

Price Ceiling is maximum mandated sale price by government, selling above which is prohibited. It is usually created below equilibrium price, to protect the interest of buyers.

As supply & demand are respectively positive & negative sloping, lower price decreases supply & increases demand. This creates excess demand or shortage.

Price Elasticity is responsiveness of demand due to change in price. If it is more, demand would change more due to price change. So, shortage would be more in this case.

As, there is excess demand - all the tickets would be sold, the same number of people would still attend the events (as the hall occupancy is same).

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Suppose that a business incurred implicit costs of $200,000 and explicit costs of $1 million in a specific year. If the firm sol
jenyasd209 [6]

Answer:

$200,000

Explanation:

Accounting profit = Total revenue - Explicit cost

Total revenue = 4000 × $300 = $1,200,000

$1.2 million - $1 million = $200,000

I hope my answer helps you

4 0
3 years ago
Question 1 (1 point) One of the ways rent control is inefficient is that it leads to: a markets that maximize total surplus. b h
andre [41]

One of the ways that rent control is inefficient is that it has high opportunity costs associated with wasted time for apartment seekers.

<h3>What is rent control?</h3>

This is the term that is used to explain the control that the government of a country has on landlords that lease their houses out to tenants.

It puts a limit on the amount of money that landlords of houses can collect as the rent for their houses.

Read more on rent control here:

brainly.com/question/1331723

7 0
2 years ago
Last year Rennie Industries had sales of $395,000, assets of $175,000 (which equals total invested capital), a profit margin of
maxonik [38]

Answer: 5.9%

Explanation:

Before:

Equity is calculated as:

= Total Assets / Equity Multiplier

= $ 175,000 / 1.2

= $ 145,833

Therefore, ROE will be:

= (Turnover × Profit Margin) / Equity

= ($ 395,000 × 5.3%) / $ 145,833

= $ 20935 / $145,833

= 0.1436

= 14.36%

After:

New Total Assets will be:

= $ 175,000 - $ 51,000

= $ 124,000

Equity

= Total Assets / Equity Multiplier

= $ 124,000 / 1.2

= $ 103,333

ROE will then be:

= (Turnover × Profit Margin) / Equity

= ($ 395,000 × 5.3%) / $ 103,333

= $ 20935 / $ 103,333

= 0.2026

= 20.26%

Therefore, the change in ROE will be:

= 20.26% - 14.36%

= 5.9%

= 4.035%

7 0
3 years ago
During its first year in business, Comfy Home accounted for its inventory using the last in first out (LIFO) method. In the seco
Dmitry [639]

Answer:

Consistency principle

Explanation:

Accounting principles are defined as the general rules of.axcpunting that businesses are expected to follow when reporting financial information.

Accounting principles include:

- Accrual principle

- Conservatism principle

- Consistency principle

- Cost principle

- Economic entity principle

- Full disclosure principle

- Going concern principle

- Matching principle

- Materiality principle

- Monetary unit principle

- Reliability principle

- Revenue recognition principle

- Time period principle

Consistency principle requires one the continue using an accounting method consistently for future accounting periods so that information can be easily comparable.

In the given scenario the accountant tells Tenisa that US GAAP allows a company to choose its inventory valuation method as long as it doesn't change over time without a justifiable reason.

This is an example of consistency principle

5 0
2 years ago
Indicate whether each of the following transactions represents an increase in net exports, a decrease in net exports, an increas
Alborosie

Answer:

Net export decreases and net capital outflow decreases

Net export increases and net capital outflow decreases

Net export decreases and net capital outflow increases

Net export increases and net capital outflow increases

Explanation:

Net export = export - import

export would comprise of goods and services produced in the US that are been sold to foreign countries

Import would comprise of foreign produced goods and services that are been sold in the US

Net export would increase when export occurs and decrease when import occurs

Net capital outflow measures the flow of funds in a country. It is the difference between purchase of foreign assets by the citizens of a country and the purchase of domestic assets by foreigners

Net capital outflow = purchase of foreign assets by citizens - purchase of domestic assets by foreigners

Net capital outflow is positive when purchase of foreign assets occur and negative when purchase of domestic assets occur.

1. the setting up of the factory is an import and there is a flow of funds into the US economy. Thus, net export and net capital flow decrease

2. A Apple computer is produced in the US. The sale to a German constitutes an export but there is a flow of fund into the US economy. net export increase and net capital outflow decreases

3. Sony is not produced in the US. the purchase of the TV constitutes an import and there is a flow of funds out of the US economy. Net export reduces and net capital outflow increases

4. The opening of the fashion company outlet in the UK constitutes an export and there is a flow of funds out of the US. Net export increases and net capital outflow increases

7 0
3 years ago
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