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Why does a tax create a deadweight loss? What determines the size of this loss?
A tax makes deadweight loss by artificially increasing price above the free market level, so decreasing the equilibrium quantity. This reduction in demand decreases consumer also producer surplus. The size of the deadweight loss depends upon the elasticities of supply and demand. Since the elasticity of demand increases and the elasticity of supply decreases, that is as supply becomes more inelastic, the deadweight loss becomes larger.
Q. How are LIBOR, TIBOR and EURIBOR determined? London Inter Bank Offered rate ( LIBOR) and is the rate of interest at which banks offer funds to other banks in marketable siz
What is the debt security in the financial term? Debt instruments are instruments which promise the payment of specified sums to the investor. Illustrations of debt instruments
Exit strategy Venture capitalists and other financiers will negotiate an exit strategy at the point of advancing the money. The exit strategy will involve them realising their
Profitability Ratios Profit Margin It is a measure of the profit margin of the company. This is important to gauge the financial position of the company.
what is the goal of financial manager
You work for a small, for-profit health system. Your system is interested in acquiring a Critical Access Hospital (CAH) at a price of $65,000,000. The purchase would be made from r
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Your task is to prepare a presentation for a group of board members who are considering an investment of $100 million in your company. Your presentation will consist of three disti
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Absolute Performance Standard is a method of measuring an organization's development and how effective and efficient it is at operating its business. The absolute performance stand
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