This social cost is called deadweight loss or excess burden or
allocative inefficiency. It is linked with the distortion in consumption
resulting from monopolized pricing. Deadweight
loss<span> is the descent
in overall surplus that results from a market distortion, like tax for example.
In economics, it is defined as a damage in economic efficiency that can happen when equilibrium
for an amenity is not attained or is considered unachievable</span>
Answer:
The answer is
1. False
2. True
3. True
4. True
5. False
Explanation:
1. False. Banks does not keep the entire value of all customer deposits in the bank vault. Some customers deposit will be given out as loan and other Investment opportunities.
2. True. Loans given out to borrowers are part of customers' deposits.
3. True. Bank run occurs when customers try to withdraw their money from a bank at once, maybe the bank is in crisis.
4. True. Federal Deposit Insurance Corporation protects customers' deposits
5. False. The fractional reserve banking system requires all banks to keep part of customer deposits in the bank vault to prevent bank runs
Answer:
$5,400
Explanation:
During a high level of activity in the month of November, 7,000 machine hours were run and the power costs was $18,000
During a low level of activity in the month of April, 2,000 machine hours were run and the power costs was $9,000
The first step is to calculate the variable cost per unit
= (high power cost-low power cost)/(high machine hours-low machine hours)
= ($18,000-$9,000)/(7,000-2,000)
= 9,000/5,000
= 1.8
Therefore, the estimated fixed cost of the power costs can be calculated as follows
= High power cost-high machine hours×variable cost per unit
= $18,000-7,000×1.8
= 18,000-12,600
= $5,400
Hence the estimated fixed cost element of power costs is $5,400
