Answer: aggregate demand; left; lower; lower; higher
Explanation:
If the economy is initially in equilibrium at full employment real GDP (QN), and a stock market crash reduces household wealth and lowers investor confidence, ceteris paribus, the (aggregate demand) curve will shift to the (left) resulting in a (lower) price level (P), (lower) output/real GDP level (Q), and (higher) unemployment level (U).
It should be noted that the crash in the stock market will lead to lesser funds in the economy and lessee funds with households and this will lead to reduction in the demand for goods which will shift the demand curve to the left.
aggregate demand; left; lower; lower; higher
Answer and Explanation:
The calculations are shown below:
1) 4
is choosen because the marginal utility should be less than the marginial cost and if he choose beyong this point, the cost of the drink is more than the willingness to pay
2) The consumer surplus is
= (5 - 1.5) + (4 - 1.5) + (3 - 1.5) + (2 - 1.5)
= 8
3) Total surplus decreases to
= Consumer surplus - external cost
= 8 - 4
= 4
4) Cindy's Consumer surplus is
= (5 - 1.5) + (4 - 1.5) + (3 - 1.5)
= 7.5
5) Increases
6) 8 - 7.5 = 0.5
7) Consumption = 3 bottles
8) Consumer surplus is
= (5 - 2.5) + (4 - 2.5) + (3 - 2.5)
= 4.5
9) External cost = 3 × 1 = 3 bottle
10) Government revenue = 3 × 1 = 3 bottle
11) Total surplus is
= Consumer surplus - external cost + government revenue
= 4.5 - 3 + 3
= 4.5
12) would
13) increases
Answer:
The total return is 12%
Explanation:
First and foremost we need to establish the bond price now, which is present value of cash flows (all coupon payments and repayment of principal) till maturity.
In calculating the price of the bond , I multiplied the discount factor by the cash flows.
The discount factor is 1/(1+r)^-N,where r is the yield to maturity and N is the number of years to maturity taken as 6 years previously and 5 years now.
N is the relevant year the cash flow is received .
The initial price at which bond is bought is $1,092.46 (as calculated in the attached)
The price the bond is sold now is $ 1,123.01 (
as calculated in the attached)
the total return=(selling price now+coupon received)/ initial purchase price
the total return =($1,123.01 +$100)/$ 1,092.46 -1
=1.12-1
=12%
Answer:
PV= $4,903.38
Explanation:
Giving the following information:
FV= $35,000
n= 15 years
i= 14% compounded annually
<u>To calculate the initial investment required, we need to use the following formula:</u>
PV= FV/(1+i)^n
PV= present value
FV= future value
i= interest rate
n= number of years
PV= 35,000/(1.14^15)
PV= $4,903.38
Answer:
There is a Lower fixed cost of process A, So, until 2,000 units are not achieved ,the process A should be chosen as priority and above the 2,000 units, process B should be chosen.
Explanation:
Cross over point
= ( Difference in fixed costs) / ( Difference in variable cost per unit)
= ($20,000 - $8,000) / ($10 - $4)
= $12,000 / $6
= 2,000 units
As per the general rule of choosing, above the cross over point, the process with lower variable cost should be chosen and below cross over point, the process with lower fixed cost should be chosen
There is a Lower fixed cost of process A, So, until 2,000 units are not achieved ,the process A should be chosen as priority and above the 2,000 units, process B should be chosen