About 100 million pounds of jelly beans are consumed in the united stats each year, and the price has been about 50 cents per pound. however, jelly bean producers feel that their incomes are too low and have convinced the government that price supports are in order. specifically, the government has agreed to buy up as many jelly beans as necessary to keep the price at $1 per pound. however, government economists are worried about the impact of this program because they have no estimates of the elasticities of jelly bean supply or demand.
a. could this program cost the government more than $50 million per year? under
what conditions? illustrate with a diagram.

b. could this program cost consumers in terms of lost consumer surplus more that $50 million? under what conditions? again, illustrate with a diagram.

Lavage rapide is a canadian company that owns and operates a large automatic car wash facility near montreal. the following table provides data concerning the company’s costs: fixed cost per month cost per car washed cleaning supplies $ 0.70 electricity $ 1,400 $ 0.07 maintenance $ 0.15 wages and salaries $ 4,900 $ 0.30 depreciation $ 8,300 rent $ 1,900 administrative expenses $ 1,400 $ 0.03 for example, electricity costs are $1,400 per month plus $0.07 per car washed. the company expects to wash 8,000 cars in august and to collect an average of $6.50 per car washed. the actual operating results for august appear below. lavage rapide income statement for the month ended august 31 actual cars washed 8,100 revenue $ 54,100 expenses: cleaning supplies 6,100 electricity 1,930 maintenance 1,440 wages and salaries 7,660 depreciation 8,300 rent 2,100 administrative expenses 1,540 total expense 29,070 net operating income $ 25,030 required: calculate the company's revenue and spending variances for august.

3. describe the purpose of the sec. (1-4 sentences. 2.0 points)

The following costs were incurred in may: direct materials $ 44,800 direct labor $ 29,000 manufacturing overhead $ 29,300 selling expenses $ 26,800 administrative expenses $ 37,100 conversion costs during the month totaled: