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Alecsey [184]
3 years ago
6

Consider the market for socks. The current price of a pair of plain white socks is $6.00. Two consumers, Jeff and Samir, are wil

ling to pay $7.00 and $8.50, respectively, for a pair of plain white socks. Two sock manufacturers are willing to sell plain white socks for as little as $4.50 and $5.50 per pair. What is the total producer and consumer surplus (i.e., social welfare) in this market
Business
1 answer:
muminat3 years ago
3 0

Answer:

consumer surplus = $3.5

producer surplus = $2

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

Jeff's consumer surplus = $7 - $6 = $1

Samir's  consumer surplus = $8.50 - $6 = $2.50

total consumer surplus = $1 + $2.50 = $3.50

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

Manufacturer 1's producer surplus = $6 - $4.5 = $1.50

Manufacturer 2's producer surplus = $6 - $5.50 = $0.50

total producer surplus = $1.50 + 0.50 = $2

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Question 2 of 10
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It should be noted that a benefit of contributing to a retirement account is A. The amount of income that's taxable is reduced.

<h3>What is the benefit of retirement account?</h3>

It should be noted that employee contribution can help in reducing taxable income.

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Therefore, the benefit of contributing to a retirement account is the amount of income that's taxable is reduced.

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2 years ago
Axiom International wants to expand its operations to a country that is politically, culturally, and economically different from
alex41 [277]

Answer:

B. Joint venture

Explanation:

Since what Axiom needs is a mode of entry which would give it access to local knowledge, allow sharing of development costs and risks, and also be politically acceptable then joint venture would be the most suitable.

Joint venture is a businesssituation where two or more parties join resources together to accomplish a specific task

5 0
3 years ago
A teacher who counts the number of times a student raises her hand is using what type of recording system?
luda_lava [24]

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4 0
3 years ago
You short sold 500 shares of Jasper stock at $41 a share at an initial margin of 60 percent. What is the highest the stock price
avanturin [10]

Answer:

Px = \frac{[(N*P) +(N*P*M1]/N}{1+ M2}

And if we replace we have this:

Px =\frac{[(500*41) +(500*41*0.6]/500}{1+ 0.4}

Px= 46.857 \ approx 46.86

So then the highest the stock price can go before you receive a margin call if the maintenance margin is 40 percent is $ 46.86.

See explanation below.

Explanation:

For this case we define the following notation:

N= 500 represent the number of stocks for JAsper

P = 41 represent the stock price

M1 = 60% = 0.6 represent the initial margin

Px represent the highest stock price the variable of interest for this case

M2= 40% or 0.4 represent the mainteneance margin

We can find the value of Px with the following formula on this case:

Px = \frac{[(N*P) +(N*P*M1]/N}{1+ M2}

And if we replace we have this:

Px =\frac{[(500*41) +(500*41*0.6]/500}{1+ 0.4}

Px= 46.857 \ approx 46.86

So then the highest the stock price can go before you receive a margin call if the maintenance margin is 40 percent is $ 46.86.

5 0
3 years ago
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