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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.
On January 1 a bond with face value of $1,000 is for sale in the market. That bond has a coupon rate of 6%, pays interest only once a year and the end of the year, and matures at
Explain the conditions under which the forward exchange rate will be an unbiased predictor of the future spot exchange rate. Answer: the conditions when forward exchange rate
define matching principle of working capital financing
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Describe how society's interests can influence financial managers. Sometimes the interests of a business firm's owners aren't the same as the interests of society. For illustr
Need help with explanations for the answers chosen, not good with math calculations, or explaining the answers, can you help with this.Chapters 6, 8
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