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kobusy [5.1K]
1 year ago
11

If government spending increases or personal income taxes decrease, what are the likely effects on output, price level, and inte

rest rates?
Price Level / Output / Interest Rates


1) Increase / Increase / Decrease

2) Increase / Increase / Increase

3) Decrease / Increase / Decrease

4) Decrease / Decrease / Decrease

5) Decrease / Decrease / Increase
Business
1 answer:
Mila [183]1 year ago
7 0

When there is an increase in government spending, there will be an increase on the output, price level, and interest rates

<h3>What is a government spending?</h3>

This refers to the funds injected to the public sector on the acquisition of services such as education, healthcare, social protection, defense etc.

Most time, the effect of an an increase in government spending leads to an increase on the output, price level, and interest rates as it is a method of stimulate demand.

Therefore, the Option A is correct.

Read more about government spending

<em>brainly.com/question/25125137</em>

#SPJ1

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Two mutually exclusive investment opportunities require an initial investment of $7 million. Investment A pays $1.5 million per
Nataly_w [17]

Answer:The cost of capital that will make both investments equal is 17.045%

Explanation:

Investment A

$1.5 million will be received in perpetuity we can there use perpetuity formula to Value investment A.

Value of Investment A = 1500 000/r

Investment B

$1.2 Million will be received in Investment B with a growth rate of 3% will then use Gordon's growth rate model to value investment B.

Value of investment B = (1200 000 x (1+0.03))/(r - 0.03)

Value of investment B = 1236000/(r - 0.03)

1500 000/r = 1236000/(r - 0.03)

1236000(r) = 1500000(r - 0.03)

(r - 0.03) = 1236000( r)/1500000

r - 0.03 = 0.824r

r - 0.824r = 0.03 = 0.176r = 0.03

r = 0.03/0.176 = 0.170454545

R = 17.045%

The cost of capital that will make both investments to be equal is 17.045%

4 0
3 years ago
If a firm in a purely competitive market can differentiate its product or service, it becomes part of a(n) ________ market.
k0ka [10]

If a firm in a purely competitive market can differentiate its product or service, it becomes part of a monopolistic competition market.

Monopolistic competition is a type of imperfect competition in which many manufacturers compete with each other, but sell different products, so they are not perfect substitutes.

These sellers can calculate their prices based on the uniqueness of the products they are offering, so you cannot compete on price. Also, this company that

has full control or is trying to have full control of something, especially has areas of business that no one else is involved with. She didn't think the fines would be a sufficient deterrent to monopoly practices by large manufacturers. The company has been accused of monopolistic conduct.

Learn more about monopolistic  here

brainly.com/question/25717627

#SPJ4

5 0
1 year ago
What Economic Issue arises in this graphic due to the Max Price being below Equilibrium?
kakasveta [241]

As u asked in ur question which food we should have before exercise : ANSWER is - Option (B)

cross check if u have doubt it's correct..

6 0
2 years ago
Why has le pliage been so successful? to what do you attribute its popularity and longevity? what is the role of the longchamp b
blondinia [14]

Longchamp’s iconic merchandise, Le Pillage is a range of foldable, leather-trimmed nylon bags. The huge success is labelled as “eternal”. Le Pillage’s achievement can be regarded as a perfect practice of marketing mix. Part of 4P model can be used to analyze this case.

Product

Le Pillage’s successful product positioning is “Quality”. Intended as a functional bag, Le Pillage accepted one of the most practical and unusual materials, nylon which is durable, sturdy, light as well as cheap.

Price

Le Pillage’s price plan, that average price is €90, made this sequence of bags reasonable to most of the consumers.

Promotion

In 2006, Le Pliage sprang its first marketing campaign with Kate Moss. Even in this campaign, model didn’t carry Le Pliage, halo effect of Longchamp brand has enthused its trades.

Place

Longchamp brand as the strongest support plays the crucial role in Le Pliage’s successful distribution. 

5 0
3 years ago
Dorsey Company manufactures three products from a common input in a joint processing operation. Joint processing costs up to the
Mumz [18]

Product A and Product C should be sold at the split-off point    

Product B should be processed further.

<h3 /><h3>    What is the meaning of joint costs?</h3>

A joint cost is an expenditure that benefits more than one product, and for which it is not possible to separate the contribution to each product.

The accountant needs to determine a consistent method for allocating joint costs to products.

<h3>How to calculate joint variable cost?</h3>

One of the simplest methods to apportion joint cost is the average unit cost method.

Here, the average cost per unit is calculated by simply dividing the total cost of all the joint products incurred before their splitting-off, by the total of the number of units produced all together.

Learn more about joint cost here:

<h3>brainly.com/question/15276894</h3><h3 /><h3>#SPJ4</h3>

4 0
2 years ago
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