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How can a price ceiling make consumers better off? Under what conditions might it make them worse off?
If the supply curve is completely inelastic a price ceiling will raise consumer surplus. If the demand curve is inelastic, price controls might result in a net loss of consumer surplus as consumers willing to pay a higher price are not able to purchase the price-controlled good or service. The loss of consumer surplus is greater as compared to the transfer of manufacturer surplus to consumers. If demand is elastic (and supply is relatively inelastic) consumers in the aggregate will enjoy a raise in consumer surplus.
Define the Straight fixed-rate bond Straight fixed-rate bond issues comprise a designated maturity date at which the principal of the bond issue is guaranteed to be repaid. Th
As of November 1, 1999, the exchange rate in between the Brazilian real and U.S. dollar is R$1.95/$. The agreement forecast for the U.S. and Brazil inflation rates for the next 1-y
Q. Describes the methods of Capital Budgeting? Capital Budgeting: - Capital Budgeting is the procedure of making decisions for investment in long-term assets. It is a method of
which critically examines the benefits and risks to a company, of incorporating corporate debt into a portfolio of equity and debt.
What are the benefits of investing via international mutual funds? Answer: The benefits of investing via international mutual funds consist of: (a) Save transaction or info
Why does money have time value? Positive interest rates point toward that money has time value. When one person lets one more borrow money, the first person needs compensation
Q. Re-order point - technique of inventory management? Re-order point: - The re-order point is that stock level at which an order should be placed. Mutually the excessive and i
Pension Reforms On January 1, 2004, Pension Funds have come into force in India. Government servants will have to subscribe to them. The new pension fund system is primarily dr
Q. What is Cash Credit? A cash credit is an arrangement by which a bank allows his customer to borrow money up to a certain limit against some tangible securities or guarantees
What problems can take place into the capital budgeting analysis if project debt is evaluated in place of the borrowing capacity created by the project? If project debt is grea
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