Question

In: Economics

It is costly for businesses to comply with government regulation. More regulation increases per-unit production costs...

It is costly for businesses to comply with government regulation. More regulation increases per-unit production costs for businesses and shifts the aggregate supply curve to the left. Deregulation will reduce per-unit production costs and shift the AS rightward. Discuss one business and the impact sustained by regulation or deregulation of the industry and how the business model has been affected and/or potential implications. I want to do health care and cant find anything on it.

Solutions

Expert Solution

Regulation: The U.S. government is responsible for different types of regulations. These include economic and social regulations. Economic regulation sets prices or conditions for firms to enter a specific industry. Examples of regulatory agencies that provide these types of conditions are the Federal Communication Commission or ECC. Social regulation deals with the protection of individuals through an agency such as the Environmental Protection Agency (EA) or Consumer Product Key Commission (CPSC).

Privatization occurs when government lets businesses to take ownership of a public function and this is initiated through a government contract where a private company will take ownership of a product or service. A concern about privatization is that it removes the ability of the public to provide feedback. Healthcare is one of the examples in the U.S. and the concern was that many citizens were unable to afford basic care, and the costs of surgeries have skyrocketed.

Deregulation: The motive behind deregulation is to give industries more power to build the economy and reduce the cost of government subsidies and ultimately give consumers more benefits through competitive pricing and better quality products and services. Examples of deregulation in the U.S. include airlines, trucking, natural gas and banking in the 1970s. The deregulation of the airline industry saw customer-centric operations, increased flight frequency, quality of food, and cabin-crew service. Deregulation occurs in one of three ways. First, Congress can vote to repeal a law. Second, an agency can remove the regulation under an Executive Order. Third, the agency can simply stop enforcing the regulation. Deregulation allows more innovation from small, niche players, and allows the free market to set prices. Consumer groups also prompt deregulation pointing out how crazy industry leaders are with their regulatory authorities.

Rahul Sunny answered 8 months ago
Next > < Previous

Related Solutions

Forum It is costly for businesses to comply with government regulation. More regulation increases per-unit production...
Forum It is costly for businesses to comply with government regulation. More regulation increases per-unit production costs for businesses and shifts the aggregate supply curve to the left. Deregulation will reduce per-unit production costs and shift the AS rightward. Discuss one business and the impact sustained by regulation or deregulation of the industry and how the business model has been affected and/or potential implications.
Fixed costs are P10 per unit and variable costs are P25 per unit. Production was 13,000...
Fixed costs are P10 per unit and variable costs are P25 per unit. Production was 13,000 units, while sales were 12,000 units. Determine (a) whether variable cost income from operations is less than or greater than absorption costing income from operations, and (b) the difference in variable costing and absorption costing income from operations.
Costs per Equivalent Unit and Production Costs The following information concerns production in the Forging Department...
Costs per Equivalent Unit and Production Costs The following information concerns production in the Forging Department for November. All direct materials are placed into the process at the beginning of production, and conversion costs are incurred evenly throughout the process. The beginning inventory consists of $105,410 of direct materials. ACCOUNT Work in Process—Forging Department ACCOUNT NO. Date Item Debit Credit Balance Debit Credit Nov. 1 Bal., 8,300 units, 30% completed 114,125 30 Direct materials, 76,000 units 942,400 1,056,525 30 Direct...
Costs per Equivalent Unit and Production Costs The following information concerns production in the Forging Department...
Costs per Equivalent Unit and Production Costs The following information concerns production in the Forging Department for November. All direct materials are placed into the process at the beginning of production, and conversion costs are incurred evenly throughout the process. The beginning inventory consists of $115,200 of direct materials. ACCOUNT Work in Process—Forging Department ACCOUNT NO. Date Item Debit Credit Balance Debit Credit Nov. 1 Bal., 9,000 units, 70% completed 137,880 30 Direct materials, 82,000 units 1,033,200 1,171,080 30 Direct...
Costs per Equivalent Unit and Production Costs The following information concerns production in the Forging Department...
Costs per Equivalent Unit and Production Costs The following information concerns production in the Forging Department for September. All direct materials are placed into the process at the beginning of production, and conversion costs are incurred evenly throughout the process. The beginning inventory consists of $52,070 of direct materials. ACCOUNT Work in Process—Forging Department ACCOUNT NO. Date Item Debit Credit Balance Debit Credit Sept. 1 Bal., 4,100 units, 30% completed 54,899 30 Direct materials, 37,000 units 458,800 513,699 30 Direct...
Sales price P15 per unit Variable costs: SG&A P2 per unit Production P4 per unit Fixed...
Sales price P15 per unit Variable costs: SG&A P2 per unit Production P4 per unit Fixed costs (total cost incurred for the year): SG&A P14,000 Production P20,000 During the first year, Sherrill Corporation manufactured 5,000 units and sold 3,800. There was no beginning or ending work-in-process inventory. 1. How much income before income taxes would be reported if Stanley uses absorption costing? 2. How much income before income taxes would be reported if variable costing was used? 3. Show why...
Ch 17#13 Costs per Equivalent Unit and Production Costs The following information concerns production in the...
Ch 17#13 Costs per Equivalent Unit and Production Costs The following information concerns production in the Forging Department for November. All direct materials are placed into the process at the beginning of production, and conversion costs are incurred evenly throughout the process. The beginning inventory consists of $91,800 of direct materials. ACCOUNT Work in Process—Forging Department ACCOUNT NO. Date Item Debit Credit Balance Debit Credit Nov. 1 Bal., 9,000 units, 30% completed 101,520 30 Direct materials, 82,000 units 811,800 913,320...
Question 12.5 pts As the level of activity increases: fixed costs per unit decrease and total...
Question 12.5 pts As the level of activity increases: fixed costs per unit decrease and total variable costs decrease total variable costs increase and fixed costs per unit remain constant fixed costs per unit increase and total variable costs remain constant total variable costs decrease and fixed costs per unit increase fixed costs per unit remain constant and total variable costs remain constant total variable costs increase and fixed costs per unit increase none of the above are correct
As government regulation of employee safety and health issues increases, what are the obligations of business...
As government regulation of employee safety and health issues increases, what are the obligations of business to protect workers? Do employers have a duty to provide job security to their workers?
Baxter Corp currently makes 10,000 subcomponents annually. The unit production costs are as follows: Per Unit...
Baxter Corp currently makes 10,000 subcomponents annually. The unit production costs are as follows: Per Unit Direct materials $25 Direct labor $10 Variable overhead $15 Fixed overhead $20 An outside supplier offers to provide Baxter Corp with the 10,000 subcomponents at a $65 per unit price. (T or F) If Baxter Corp accepts the outside offer, then short-term profits will increase by $150,000. True or False
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT