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3 years ago

If demand increased by 100 units at each price level, and the government set a price ceiling of $40, then there will be

Business

1 answer:

mel-nik [20]3 years ago

4 0

Answer:

no surplus or shortage

Explanation:

Equilibrium price is the price at which quantity demand equal quantity supplied. Above equilibrium price there is a surplus - quantity supplied exceeds quantity demanded.

Below equilibrium price there is a shortage - quantity demanded exceeds quantity supplied

If demamd increases by 100, new equilibrium is 40

Thus, ceiling price equal equilibrium

Price ceiling is when the government or an agency of the government sets the maximum price for a product. It is binding when it is set below equilibrium price.

Effects of a binding price ceiling

It leads to shortages

it leads to the development of black markets

it prevents producers from raising price beyond a certain price

It lowers the price consumers pay for a product. This increases consumer surplus

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3 years ago

Single Plantwide Factory Overhead Rate Scrumptious Snacks Inc. manufactures three types of snack foods: tortilla chips, potato c

Pie

Answer:

Scrumptious Snacks Inc.

a. Single plantwide factory overhead rate = $77.51 per hour

b. Total Factory Per-Case Factory

Overhead Overhead

Tortilla chips $20,928 $7.75

Potato chips 17,440 11.63

Pretzels 36,275 9.30

Total $74,643

Explanation:

a) Data and Calculations:

Budgeted costs:

Factory depreciation $17,167

Indirect labor 42,545

Factory electricity 4,852

Indirect materials 10,076

Total factory overhead = $74,640

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Administrative expenses 13,435

Total costs $111,960

Production budget and processing hours per case:

Budgeted Volume Processing Total

(Cases) Hours Per Case Hours

Tortilla chips 2,700 0.10 270

Potato chips 1,500 0.15 225

Pretzels 3,900 0.12 468

Total 8,100 963

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b. Overhead allocated to each product:

Total Total Budgeted Per Case

Hours Overhead Cases Overhead

Tortilla chips 270 * $77.51 = $20,928 2,700 $7.75

Potato chips 225 * $77.51 = 17,440 1,500 $11.63

Pretzels 468 * $77.51 = 36,275 3,900 $9.30

Total 963 = $74,643 8,100

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3 years ago

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Answer:

Explanation:

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| Consumer demand can change often; for many reasons

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4 years ago

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