A Price Ceiling Set Above the Equilibrium Price of a Good

question 69

True/False

A price ceiling set above the equilibrium price of a good will result in a shortage.

Understand the legal classification of contracts (void, voidable, unenforceable, and executed contracts).

Differentiate between contracts and agreements and understand the requirements for legal enforceability.

Recognize and explain the equitable remedy of quasi-contract.

Identify and explain the rights and claims of third parties in contract law, specifically intended beneficiaries.

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Definitions:

Cash Cycle

The time between cash disbursement and cash collection.

Receivables Balance

The total amount of money owed to a company by its customers for goods or services delivered or used but not yet paid for.

Accounts Receivable Turnover

This ratio measures how efficiently a company collects revenue from its customers by dividing total sales by the average accounts receivable during a specific period.

Credit Sales

Sales transactions where the payment is deferred to a future date, essentially extending credit to the purchaser.