Answer:
Explanation:
The lunch plate industry in Oahu is a perfectly competitive industry.
This industry is also a decreasing cost industry. A decreasing cost industry can be defined as the type of industry where an increase in the number of firms in the industry causes the average production cost to decline.
The industry is currently in long-run equilibrium and has the price level at $5.
As the demand increases, the price level will initially increase. But this increase in the price will cause the profits to increase and thus attract potential firms to join the market.
As the number of firms increases the average cost of production will decrease. As a result, the supply in the market will increase more than the demand.
So the long-run equilibrium will be reestablished at a lower price than earlier.
Answer:
e) Safety stock.
Explanation:
The term that describes this form of safety-net for companies is called safety stock. Companies tend to have this in order to be able to maintain their business flow as efficiently as possible in case there are unforeseen increases in demand. Otherwise, if demand drastically increases and they do not have this safety stock the company will run out of stock immediately and lose out on sales as they wait for more stock to arrive, which can also cause that stock to sell out immediately due to the backed-up demand, which can lead to the business buying backed up for months.
Answer:
$5,000
Explanation:
The computation of total amount of excess fair over book value amortization expense adjustments to be recognized by red is shown below:-
Excess of fair value over book value = Land fair value - Land book value
= $52,000 -$42,000
= -$10,000
Here land is not amortized
Excess of fair value over book value = Building fair value - Building book value
= $390,000 - $200,000
= $190,000
Excess fair value over book value amortization expense adjustments to be recognized by red = Excess of fair value over book value of building ÷ Number of Years
= $190,000 ÷ 10
= $19,000
Excess of fair value over book value = Equipment fair value - Equipment book value
= $280,000 - $350,000
= ($70,000)
Excess fair value over book value amortization expense adjustments to be recognized by red for equipment = Excess of fair value over book value of equipment ÷ Number of Years
= ($70,000) ÷ 5
= ($14,000)
Total amount of excess fair over book value amortization expense adjustments to be recognized by red
= $19,000 - $14,000
= $5,000
A master plan is devised for long-range goals
According to the law of supply, if the price decreases, the quantity supplied will be decreased
The law of supply is a microeconomic principle that asserts, with all other things being equal, that if the cost of an item or service rises, suppliers will offer more of those goods or services, and vice versa.
According to the rule of supply, suppliers will try to maximise their earnings when the price of an item rises by offering more products for sale.
Learn more about law of supply here
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