All categories

3 years ago

Suppose a city is considering placing a ceiling on rent for one-bedroom apartments, at $1,000 per apartment.

Business

1 answer:

Dafna1 [17]3 years ago

4 0

Answer:

(a) The market equilibrium rent is $1,400 and the equilibrium quantity is 15 thousand apartments.

(b) With the price ceiling, the rent is $1,000 per apartment and the quantity rented is 10 thousand apartments.

Explanation:

(a) At equilibrium, demand function equals supply function

1700 - 20Q = 80Q + 200

1700 - 200 = 80Q + 20Q

100Q = 1500

Q = 1500/100 = 15

Substitute the value of Q in the demand function

P = 1700 - 20Q = 1700 - 20(15) = 1700 - 300 = 1400

Equilibrium rent = $1,400

Equilibrium quantity is 15 thousand apartments

(b) Rent with price ceiling is $1,000 per apartment

Substitute the value of P in the supply function

P = 80Q + 200

1000 = 80Q + 200

1000 - 200 = 80Q

80Q = 800

Q = 800/80 = 10

Quantity rented is 10 thousand apartments

P = 1000

Q = (1700 - 1000)/20 = 700/20 = 35

Excess demand = 35 - 15 = 20

You might be interested in

_________ is a condition in which the average level of prices is actually falling.

jeyben [28]

Answer:

Deflation

Explanation:

Deflation is the overall decrease in products and services prices when the rate of inflation drops below 0%. it naturally occurs when an economy's money supply is fixed.

The buying power of currency and salaries in moments of deflation is greater than they would have been.

This is different but comparable to price deflation, which is a general price level reduction.

6 0

3 years ago

In the film Islam and America: Through the eyes of Imran Khan, which of the following best describes how average Pakistanis resp

aleksley [76]

Answer: c. They criticized or disparaged the IMF.

Explanation:

In the 2001 film, Islam and America: Through the eyes of Imran Khan, it is shown that the average person in Pakistan know what the IMF is and detests them. They criticized and disparaged the IMF with some reasons given being that;

the IMF is a way for the Developed world to economically colonise Pakistan
the IMF is tool for the Americans to use and try to assert control
the IMF forces governments to raise utility prices to meet their conditions or pay back loans which makes poor people suffer the most.

5 0

3 years ago

Hoffman-LaRoche Ltd. and BASF AG, two international pharmaceutical companies, were ordered to pay $725 million in fines for plot

olya-2409 [2.1K]

Answer:

Political and Legal

Explanation:

Hoffman-LaRoche Ltd. and BASF AG, two international pharmaceutical companies, were ordered to pay $725 million in fines for plotting to raise and fix prices of vitamins used in virtually every home in the U.S. This is an example of how political and legal forces affect the marketing environment.

Business organisations operate within a political system and legal framework. Political factors determine economic policies like taxation and regulations. Business decisions are subject to, and are affected by political and legal factors.

Governments formulate a series of legislations to monitor business activities and protect consumer and social interests.

Such laws would either create new opportunities or threats for the businesses in existence.

In the Scenario above Hoffman-LaRoche and BASF AG must have violated regulations that protect consumer interests put in place by the government by wanting consumers to pay too high for such necessities as vitamins and huge fines have been imposed on them.

7 0

3 years ago

Praxis Corp. forecasts the following income statement for the next year:

Annette [7]

Answer: a. 1.42

b) 2.74

c) 3.89

Explanation:

a) The Degree of Operating Leverage measures how much operating Income will change by if Sales change.

It is calculated with the formula,

= (Sales - Variable Costs) / (Sales - Variable Costs - fixed costs)

= (960,000 - 532,000) / (960,000 - 532,000 - 127,000)

= 1.42

b) The Degree of financial leverage measures how much Income will change due to a change in operating Income.

The formula is,

=Earnings before Interest and tax / Earnings before Interest and tax - Interest or just Earning before tax

= 301,000/110,000

= 2.74

c. Degree of Total Leverage is a measure of how sensitive the net income of a company is to a change in goods produced and/or sold.

It is calculated by multiplying DOL and DFL.

= 1.42 * 2.74

= 3.89

Should you need any clarification just hit that comment button. Cheers.

3 0

3 years ago

he nation of Pecunia had a current account deficit of $ billion and a nonreserve financial account surplus of $ million in 201

Andrei [34K]

Answer: -$500,000,000

Explanation:

The Balance of payment is an account that shows the difference between the money coming into a country as a result of transactions with other nations and money going out for the same reason.

Given the figures in the question, the Balance of Payments is;

= Current Account balance + Nonreserve financial account balance

= -1,000,000,000 + 500,000,000

= -$500,000,000

4 0

3 years ago