The accompanying table shows the demand and supply schedules for lobster. The U.S. government decides that the incomes of lobster farmers should be maintained at a level that allows them to survive. It therefore implements a price floor of $14 per pound by buying surplus lobster until the market price is $14 per pound. Quantity Demand (thousands of pounds) Quantity Supplied (thousands of pounds) Price of Lobster (per pound) $22 360 20 320 40 280 60 240 14 80 200 12 100 160 10 120 120 140 80 6. 160 40 180 Reference: Ref 2-1 Since lobster is an important source of protein and omega-3, the govermment decides to provide the surplus lobster it purchases to nursing homes at a price of only $12 per pound. Assume that nursing homes will buy any amount of lobsters available at this low price, but families of nursing home patients now reduce their purchases of lobsters at any price by 60 thousand pounds because their family members are getting lobster at nursing homes. How much will the lobster program now cost the government? OA $720.000 OB. $360,00 OC 5320,00 OD. S640,000 OE $1,440.000
The accompanying table shows the demand and supply schedules for lobster. The U.S. government decides that the incomes of lobster farmers should be maintained at a level that allows them to survive. It therefore implements a price floor of $14 per pound by buying surplus lobster until the market price is $14 per pound. Quantity Demand (thousands of pounds) Quantity Supplied (thousands of pounds) Price of Lobster (per pound) $22 360 20 320 40 280 60 240 14 80 200 12 100 160 10 120 120 140 80 6. 160 40 180 Reference: Ref 2-1 Since lobster is an important source of protein and omega-3, the govermment decides to provide the surplus lobster it purchases to nursing homes at a price of only $12 per pound. Assume that nursing homes will buy any amount of lobsters available at this low price, but families of nursing home patients now reduce their purchases of lobsters at any price by 60 thousand pounds because their family members are getting lobster at nursing homes. How much will the lobster program now cost the government? OA $720.000 OB. $360,00 OC 5320,00 OD. S640,000 OE $1,440.000
Purchasing and Supply Chain Management
6th Edition
ISBN:9781285869681
Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
Publisher:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
ChapterC: Cases
Section: Chapter Questions
Problem 5.1SC: Scenario 3 Ben Gibson, the purchasing manager at Coastal Products, was reviewing purchasing...
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