Question
In: Economics
(Two part question) explain why the concept of elastics to an understanding the impact of the...
(Two part question) explain why the concept of elastics to an
understanding the impact of the minimum wage? Graph will be
necessary
Solutions
Expert Solution
Elasticity of demand is the responsiveness of quantity demand due to change in price. It is important to take elasticity into consideration when measuring the effects of minimum wages.
Similar to elasticity of demand is elasticity of supply, which is, the responsiveness of quantity supplied due to change in price.
When we say the demand/supply is relatively elastic, the demand/supply curve is (quite) FLATTER.
When we say the demand/supply is relatively inelastic, the demand/supply curve is (quite) STEEPER.
Clearly, the impact of minimum
wage in the market is more where there is elastic demand/supply.
The excess of workers is more in the left panel (Qs - Qs) as
compared to the right panel, where the impact is less (QE -
Qi).
This is so because when the demand/supply is elastic, the quantity reponds more than the change in price. So the economy would be worse off with such a regulation if the demand/supply are relatively elastic. This policy regulation would work better where the demand/supply curves are inelastic, the loss of efficiency would be less.
Rahul Sunny answered 1 year agoRelated Solutions
Briefly explain the following Conceptual Understanding question parts (a) and (b) a) Explain the concept of time...
Briefly explain the following Conceptual Understanding
question parts (a) and (b)
a) Explain the concept of time value of money,
how that relates to the discount factor and the Net Present
Value
b) A bond with a par value of £1000 and a coupon rate
of 5% is currently trading at £800, work out its current yield
Please explain your understanding of concept of inflation, why it exists, and why it matters when...
Please explain your understanding of concept of inflation, why
it exists, and why it matters when it comes to financial
decisions
Write a paper that discusses Simon Sinek’s concept of “why” and explain its usefulness in understanding...
Write a paper that discusses Simon Sinek’s concept of “why” and
explain its usefulness in understanding how marketers go about
creating and communicating customer value.
Your paper should be a minimum of one page. You must cite at
least one source in the body of your paper and provide a full
citation using APA format.
QUESTION TWO PART A The following two economic events impact on the value of the Australian...
QUESTION TWO
PART A
The following two economic events impact on the value of the
Australian dollar in the foreign exchange rate market.
Speculators believe that the price of Australian exported
commodities (iron ore, coal) will increase and at the same time
Australian households and firms purchase less imports.
REQUIRED:
Explain the effect of the above economic
conditions on the demand for and supply of Australian dollars and
the change in the value of the Australian dollar (AUD) in the...
Why is understanding the concept of time value of money important?
Why is understanding the concept of time value of money
important?
Thoroughly explain indicate a proper understanding of the concept. Each correct answer is worth TWO marks....
Thoroughly explain indicate a proper understanding of the
concept. Each correct answer is worth TWO marks.
1. Net Worth
2. Burden of the Debt
3. Tax Rate Structure.
4. Comprehensive Income:
5. Selective Tax:
6. User Charges:
7. Taxable Income:
8. Lump-Sum Tax:
9. Capital Gains:
10.Public Finance
Which concept or activity had the greatest impact on you in macroeconomics? Explain why and how...
Which concept or activity had the greatest
impact on you in macroeconomics? Explain why and how this will
affect how you view the world and economics’ impact.
Explain the concept of linearity. Why is important this concept in engineering. Explain.
Explain the concept of linearity. Why is important this concept
in engineering. Explain.
Question # 1. In an investment market, understanding the concept of undervalued and overvalued stocks is...
Question # 1. In an investment market, understanding the
concept of undervalued and overvalued stocks is very important.
Hence, a prudent investor must have good knowledge about Beta,
Market Rate of Return and Risk Free Rate of
Return.
Required:
Being an investor, critically analyse the conditions of
undervalued and overvalued stocks
Give a graphical example to present the positioning
of:
Systematic risk
Risk free rate of return
Market rate of return, and
Risk premium.
Question # 1. In an investment market, understanding the concept of undervalued and overvalued stocks is...
Question #
1. In an investment market, understanding the concept of
undervalued and overvalued stocks is very important. Hence, a
prudent investor must have good knowledge about Beta, Market Rate
of Return and Risk Free Rate of Return.
Required:
Being an investor, critically analyse the conditions of
undervalued and overvalued stocks
Give a graphical example to present the positioning of:
Systematic risk
Risk free rate of return
Market rate of return, and
Risk premium.
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- Select a publicly-traded company and access the company’s most recent annual report (select the “Investors” menu...
- Suppose that as a financial manager you have collected the following information on your company. Before-tax...
- A settling tank treating 5.5x10*6 L of water per day has dimensions as follows: length, 12.2m;...
- You have to buy a new copier. The cost of the copier is $2,000, plus $...
- Explain the maturity stage in the industry life cycle. What happens in this stage? What types...
- Originality is a “must” in research. Therefore, use your own words when answering questions - DO...
- Explain the purpose and importance of the business plan 1 PAGE
ADVERTISEMENT