q19- Bestway pet grooming are the only dog groomers in a Smalltown, they have a thriving business charging $30 per dog washed and groomed. A dog groomer from a neighbouring town sees an opportunity to expand their business and starts offering dog grooming in Smalltown. What will be the impact on Bestway? Select one: a. Consumer and producer surplus will both increase b. A new firm in the market will increase competition and decrease producer surplus for Bestway dog grooming c. They will increase their sales and producer surplus d. Consumers will have longer wait times, as dog grooming demand will increase
q19-
Bestway pet grooming are the only dog groomers in a Smalltown, they have a thriving business charging $30 per dog washed and groomed. A dog groomer from a neighbouring town sees an opportunity to expand their business and starts offering dog grooming in Smalltown. What will be the impact on Bestway?
A new firm in the market will increase competition and decrease producer surplus for Bestway dog grooming
They will increase their sales and producer surplus
Consumers will have longer wait times, as dog grooming demand will increase
Demand: - Demand is the relationship between the quantity demanded and the price of a good. There is an inverse relationship between quantity demanded and price, which means if the price of a good increases then the quantity demanded decreases and if the price of a good decreases then the quantity demanded increases.
Supply: - Supply is the relationship between the quantity supplied and the price of a good. There is a direct relationship between the quantity supplied and the price for normal goods which means if price increases quantity supplied increases and if price decreases quantity supplied also decreases.
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