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1 year ago

The circular flow model examines interactions between which sectors of the economy?

1 answer:

8 0

The interplay between two sets of economic decision-makers—households and businesses—as well as two different categories of economic markets—the market for resources and the market for products and services—is depicted by the circular flow model.

<h3>What is circular flow model?</h3>

A model of the economy known as the circular flow of income or flow is one in which the main transactions between economic agents are shown as flows of money, products, and services, etc. In a closed circuit, the flows of money and goods are equivalent in value but move in the opposite direction. The interplay between two sets of economic decision-makers—households and businesses—as well as two different categories of economic markets—the market for resources and the market for products and services—is depicted by the circular flow model.

The circular flow diagram's four key components are people, businesses, markets for products and services, and markets for factors of production. These four components provide a framework for comprehending how money moves continuously across an economy.

Hence, The interplay between two sets of economic decision-makers—households and businesses—as well as two different categories of economic markets—the market for resources and the market for products and services—is depicted by the circular flow model.

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Answer:

Explanation:

Amount of Bolton Company inventory = 38,972

Calculations are attached

1. Find net realizable value, which is selling price - cost of disposal;

2. Then subtract normal profit from net realizable value = [g];

3. Find designated market value by choosing the middle value of cost to replace, net realizable value and [g];

4. Choose lowest between designated market value and selling price;

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3 years ago

You are considering moving your money to new bank offering a one-year CD that pays an 5 %5% APR with monthly compounding. Your

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Answer:

Explanation:

We need to understand what effective annual rate is to solve this question.

Effective Annual Rate is the actual interest earned on an investment due to effect of compounding.

The formula is:

Effective Annual Rate = $(1+\frac{i}{n})^n - 1$

Where

i is the interest rate given (nominal interest rate)

n is the number of compounding per year

For the old bank,

5% is the interest rate, so i = 5% = 5/100 = 0.05

n is the number of compounding per year, that will be n = 12 since compounding monthly

So, we have:

Effective Annual Rate $(1+\frac{0.05}{12})^{12} -1\\=0.051161$

For second bank, we have:

i = what we need to find

n = 2 (since semi annual compounding, every 6 months)

So,

Effective Annual Rate = $(1+\frac{i}{2})^2 - 1$

This should be equal to APR from 1st bank (0.05)

So, we solve for i:

$0.05=(1+\frac{i}{2})^2 - 1\\1.05=(1+\frac{i}{2})^2 \\i=0.0253$

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4 years ago

Miller Farm Products is issuing a 15-year, unsecured bond. Based on this information, you know that this debt can be described a

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Based on this information Miller Farm Products' debt can be described as a debenture.

<h3>What is Debenture?</h3>

A bond or other sort of financial instrument that is secured by collateral is referred to as a debenture.
Debentures must rely on the issuer's trustworthiness and reputation for support because they lack a collateral backstop.
Debentures are commonly issued by both businesses and governments to raise cash or money.
Debentures, like the majority of bonds, may issue periodic interest payments known as coupon payments. Debentures are described in an indenture, much like other kinds of bonds.
A binding legal agreement between bond issuers and bondholders is known as an indenture.
The agreement details the terms of a debt issue, including the maturity date, the frequency of interest or coupon payments, the formula for calculating interest, and other details.
Debentures may be issued by both governments and corporations.