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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.
Q ualification criteria We discussed how to prepare the bid documents. Let us now see what criteria should be considered to qualify a bidder. You will have to open bidding
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Determine the Preference Shares - Equity Instruments Sandwiched between equity share holders anddebt holders, preference share holders have promise of an assured dividend from
Q. Evaluate optimum price of the new machine? The optimum price will be the one which optimises total contribution over the five-year life of the new machine. Sales price o
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Identify and explain the key stages in the capital investment decision-making process and the role of investment appraisal in this process.
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1. Consider the following two investment alternatives Net cash flow End of year Machine A Machine
Explain the term “present value of the firm’s operations” (also known as Enterprise Value). What does this number represent? The present value of the free cash flows of the comp
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