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2 years ago

The long-run aggregate supply curve is represented by a vertical line at the solow growth rate because?

1 answer:

3 0

The long-run aggregate supply curve is represented by a vertical line at the Solow rate of growth because there is an underlying assumption of long-run money neutrality.

The long-run aggregate supply (LRAS) curve shows the connection between the price level and the real GDP provided all the prices were flexible. Solow growth refers to the economic process of the country in the long-run in which total saving is used for capital growth.

The LRAS curve may be a vertical line at the Solow growth because it is assuming a full-employment outcome. Vertical line on a graph implies that price index and GDP are not related anymore at the Solow growth. That's the real GDP at this potential output refers to the economy's maximum sustainable capacity. within the long-run, the important GDP is not related to the price level. it's only affected by the quantity of country's resources and production.

Learn more about The long-run aggregate supply curve at brainly.com/question/14286645

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OMG Inc. has 4 million shares of common stock outstanding, 3 million shares of preferred stock outstanding, and 50 thousand bond

babymother [125]

Answer:

$w_{d}$ = 0.3274 or, 32.74%

Explanation:

We know,

Capital Structure = Debt + Common Stock + Preferred stock

Given,

Common Stock = 4,000,000 shares

Share price = $21

Total common stock = No. of shares x share price

Total common stock = 4,000,000 shares × $21 = $84,000,000

Preferred Stock = 3,000,000 shares

Share price = $10

Total preferred stock = $10 x 3,000,000 shares

Total preferred stock = $30,000,000

Debt rate = 111% = 1.11

Debt = 50,000 bonds x $1000 par x 1.11

Debt = $55,500,000

Total Capital = $(55,500,000 + 84,000,000 + 30,000,000)

Total capital structure = $169,500,000

The weight for debt in the computation of OMG's WACC

= $\frac{Debt}{Total Capital Structure}$

= $\frac{55,500,000}{169,500,000}$

= 0.3274

or, 32.74%

8 0

4 years ago

A(n) ____________________________ exists to promote the sales of a particular manufacturer’s products.

sweet [91]

Captive finance company

6 0

3 years ago

Read 2 more answers

Consider the market for meekers in the imaginary economy of Meekertown. In the absence of international trade, the domestic pric

LenKa [72]

Answer:

Export

True

False

True

Explanation:

Free trade is a form of trade policy where there are no restrictions to imports or exports of goods and services.

The price of meekers is $30 in Meekertown and $40 In the world. Because meeker's are cheaper in Meekertown, it means that Meekertown is efficient in the production of meekers. As a result, they would export meekers to the rest of the world. It would be cost efficient for the rest of the world to import from Meekertown.

Consumers in Meekertown are worse of because of the trade because the price of Meekers would rise.

Producers are better off because they would earn more profits from the sale of Meekers at the world price.

Free trade increases total surplus because of efficient production. If a country is inefficient in production, it would import . This would increase consumer surplus and if it is efficient in production, it would export increasing producer surplus.

I hope my answer helps you

7 0

4 years ago

In preparing its cash flow statement for the year ended December 31, 2021, Green Co. gathered the following data: Gain on sale o

vazorg [7]

Answer:

$77,000

Explanation:

Data provided as per the question below:-

Proceeds from sale of common stock = $153,000

Cash dividends paid = $76,000

The computation of net cash from financing activities is given below:-

Cash inflow from Financing Activities = Proceeds from sale of common stock - Cash dividends paid

= $153,000 - $76,000

= $77,000

Therefore for computing the net cash from financing activities we simply applied the above formula.

5 0

3 years ago

The graph shows a point of equilibrium.

Alekssandra [29.7K]

Answer:

The correct answer is that the price of the product will decrease in order to meet the equilibrium

Explanation:

Equilibrium point is the point where the quantity supplied is equal to the quantity demanded. And the equilibrium price as well as the quantity is evaluated through the intersection of the demand the supply.

When the quantity which is supplied is greater or more than the quantity demanded, it will create a situation of surplus. And if the product price is decreased or lowered down, then the quantity demanded of the product will increase or rise until it reached to equilibrium. In short, the surplus drives the price down.

7 0

4 years ago