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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.
To calculate the Cost of Capital, we will use the Weighted Average Cost of Capital (WACC) formula WACC = (E/V) X R E + (D/V) X R D X (1 - T C ) where
What are the benefits of the JIT inventory control system? The just-in-time that is abbreviated as JIT inventory control system lowers inventory carrying costs and tends to inc
1) Future cost and historical cost: financial decision is based on the future cost and not on the historical cost. The decision related to the future and hence the cost are likely
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Illustration Let us assume that Vishal Mehta & Co., (from Illustration 1) is using the following discounting rates in place of one rate:
How do mergers affect communities? A: While a locally controlled bank is merged into a bank headquartered somewhere else (an out-of-market merger), a few apprehension about the i
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