Answer:
If effective, such a price floor would be <u>above</u> the market price and would lead to a <u>excess supply</u>.
Explanation:
A price floor can be described as a price control in which the minimum price to be charged for goods and services is imposed by a government or a group.
For a price floor to be effective and binding, it has to be set above the market or equilibrium price. This is because a price floor will neither be effective nor nonbinding when it set below the equilibrium price.
Any price above the equilibrium or market price creates or leads to excess supply. Excess supply is a situation whereby quantiy of commodity supplied is more than the quantity demanded of the commodity.
Based on the above explanation, if effective, such a price floor would be <u>above</u> the market price and would lead to a <u>excess supply</u>.
Answer:
$120
Explanation:
The computation of the cost is shown below:
= Cost per month flat for 1,000 units + extra cost if exceeded 1,000 minutes
where,
Cost per month flat for 1,000 units = $50
And, the extra cost is
= $0.35 × 200 minutes
= $70
So, the total cost is
= $50 + $70
= $120
The 200 minutes is come from
= 1,200 minutes - 1,000 minutes
-Inelastic means that the consumers will still purchase the product at the same rate despite price changes.
-The answer would be cancer medication, because the consumer would still need to buy this regardless of price. Even if it puts them in a financial bind.
-When having your on a car or watch, if the price of that item increases, you could be less likely to buy it.
-When picking out a hamburger at a restaurant, the customer is most likely to by a cheaper burger if they are on a budget.
Raw Materials Inventory $XX Accounts payable
Answer:
$200,000
Explanation:
The computation of Net Income is shown below:-
The green lawn firm is over-capable of approving the order. The extra fixed costs do not have to be incurred. This way, fixed costs are avoided and only variable costs need to be incurred.
For computing the net income first we need to find out the profit per unit which is here below:-
Profit per unit = Sell price per unit - Variable Cost per unit
= $1,200 - $1,000
= $200
Total Profit = Profit per unit × 1,000 unit order
= $200 × 1,000 unit order
= $200,000
So, net income increased by $200,000
Therefore for computing the total profit we simply applied the above formula.
