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Eduardwww [97]
3 years ago
14

Identify whether each of the following statements best illustrates the concept of consumer surplus, producer surplus, or neither

.
a. I sold a used textbook for $54, even though I was willing to go as low as $48 in order to sell it.
b. Even though I was willing to pay up to $71 for a watch, I bought a watch for only $65.
c. Even though I was willing to pay up to $63 for a jersey sweater and even though the seller was willing to go as low as $54 in order to sell it, we couldn't reach a deal because the government imposed a price floor of $68 on the sale of sweaters.
Business
1 answer:
alina1380 [7]3 years ago
5 0

Answer:

producer surplus

consumer surplus

neither

Explanation:

Consumer surplus is the difference between the willingness to pay of a consumer and the price of the good.

Consumer surplus = willingness to pay – price of the good

The highest amount i was willing to buy the watch is $71 but the price was $65. this illustrates a consumer surplus

Producer surplus is the difference between the price of a good and the least price the seller is willing to sell the product

Producer surplus = price – least price the seller is willing to accept

The least amount the textbook seller was willing to sell was $48 while the price the textbook was sold was $54. thus, a illustrates a producer surplus.

for statement c, a transaction did not take place, so, it is neither a producer or consumer surplus

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A representative from AT&T called Dr. Michaels after he switched to its new U-verse telephone system. The firm wanted to mak
Blizzard [7]

Answer: follow up call

Explanation:

From the question, we are informed that a representative from AT&T called Dr. Michaels after he switched to its new U-verse telephone system and that the firm wanted to make certain he was satisfied and asked if he had any questions concerning his new service.

The above is a follow up call. A follow up call is a call that is made after a transaction has taken place or previous enquiry regarding a product has been made in order to know the latest about the product.

5 0
3 years ago
Tempo Corp. will issue preferred stock to finance a new artillery line. The firm's existing preferred stock pays a dividend of $
Len [333]

Answer:<u> </u><u><em>Relevant cost of new preferred stock = 10.53%</em></u>

Explanation:

Given:

Dividend = $4.00 per share

Selling for = $40 per share.

Flotation costs =  5% of the selling price.

Marginal tax rate is 30%.

We can compute the cost of new preferred stocks using the following formula:

Relevant\ cost\ of\ new\ preferred\ stock =\frac{ Dividend}{Current\ price\ after\ flotation\ Cost}

Relevant\ cost\ of\ new\ preferred\ stock =\frac{4}{40-(0.05\times40)}

∴ Relevant cost of new preferred stock = 10.53%

Therefore, the correct option is (d)

6 0
3 years ago
Which one of the following is not a right of common stockholders?a) To share proportionately in all management decisions.b) To s
lozanna [386]

Answer: Option A

Explanation: Common stockholders refers to the holders of common equity of an organisation. These shareholders are actually the owners of the organisation. They have the potential to earn maximum benefit and bear the maximum risk.

They have the right to select the auditor and board of directors but they cannot interfere with the management decisions. This right stands in the domain of the top managers which are appointed by these shareholders.

Thus, we can conclude that the correct option is A .

5 0
2 years ago
The interest rate that lenders publish or advertise is usually:
ivann1987 [24]

Answer:

It’s A the nominal interest rate

Explanation:

8 0
2 years ago
Samuelson will produce 20,000 units in January using level production. If each unit costs $500 to manufacture, what is the dolla
Likurg_2 [28]

Answer:

The dollar value of ending inventory is $7.500.000

Explanation:

To calculate the dollar value of ending inventory you need to use the next formula:

End inventory= (Beginning inventory + production - sales).$

In this case:

- Beginning inventory: 10.000 units

- January Production: 20.000 units

- Sales: 15.000 units

End inventory= 10000+20000-15000

End inventory= 15.000 units

Dollar value= 150000 . $500= $7.500.000

5 0
3 years ago
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