All categories

3 years ago

A. by how much will gdp change if firms increase their investment by $11 billion and the mpc is 0.9?

Business

1 answer:

Sliva [168]3 years ago

6 0

Answer:

The answer is <u>"$110 billion".</u>

Explanation:

Firms increase their investment by $11 billion

mpc = 0.9

gdp = ?

To find the gdp, first we have to find expenditure multiplier;

we will find that by using the formula;

expenditure multiplier = 1/(1-0.9) = 1/0.1 = 10

Now gdp = 10 x $11 billion

= $110 billion

Thus the <u>gdp is $110 billion.</u>

You might be interested in

A closed economy has income of $1,200 billion, government spending of $220 billion, taxes of $170 billion, and investment spendi

Llana [10]

Answer: CONSUMPTION SPENDING = $730 Billion

PRIVATE SAVING = $300 Billion

PUBLIC SAVING = -$50 Billion

NATIONAL SAVING = $250 Billion

Explanation:

The missing figures are the Consumption Spending, Private Saving, Public saving and National Saving.

This is a closed economy so no imports.

Consumption Spending.

The Formula for GDP is

Y = C + I + G

Y is income

C is Consumption

I is Investment

G is Government Spending.

Making C the subject we have,

C = Y - I - G

= 1,200 - 220 - 250

= $730 billion

Private Saving is what people are left with after taxes and Consumption so,

= Y - T - C

= 1,200 - 170 - 730

= $300 billion

Public Saving is how much the Government spent vs what it received.

The formula would therefore be

= Taxes - Government Spending

= 170 - 220

= -$50 billion

National Saving is the amount in the Economy that was saved after accounting for Consumption and Government Spending.

= Y - C - G

= 1,200 - 730 - 220

= $250 billion

If you need any clarification do react or comment.

3 0

3 years ago

The factor that has the greatest impact on your credit score is

zaharov [31]

A i just took the test its correct

6 0

3 years ago

Marathon Company has 10,000 units of its product that were produced last year at a total cost of $150,000. The units were damage

V125BC [204]

Answer: Marathon should repair the units since an income of $12000 will be gotten.

Explanation:

Based on the information given, the following can be deduced:

Revenue when repaired = 10000 × $5 = $50000

Revenue if sold without repair = 10000 × $2 = $20000

Incremental revenue = $50000 - $20000 = $30000

Cost to repair = $18000

Incremental be Income = $30000 - $18000 = $12000

Therefore, Marathon should repair the units since an income of $12000 will be gotten.

8 0

3 years ago

A company started a new product, and in the first month started 100,000100,000 units. The ending work in process inventory was 2

sukhopar [10]

Answer:

$240,000

Explanation:

Calculation for What is the value of the inventory transferred out, using the weighted-average inventory method

First step is to calculate the Equivalent material cost=

Equivalent material cost= 20,000×100%×$6

Equivalent material cost= 120,000

Second step is to calculate Equivalent conversion cost

Equivalent conversion cost=20,000×75%×8

Equivalent conversion cost=120,000

Now let calculate the value of the inventory transferred out, using the weighted-average inventory method

Inventory value transferred out= 120,000+120,000

Inventory value transferred out=$240,000

Therefore the value of the inventory transferred out, using the weighted-average inventory method is $240,000

4 0

2 years ago

At the end of the year, overhead applied was $42,000,000. Actual overhead was $40,300,000. Closing over/underapplied overhead in

scoundrel [369]

Answer:

Hence, closing over overhead into Cost of Goods Sold would cause net income to increase by $ 1,700,000

Explanation:

Overheads are charged to units produced by the means of using an estimated overhead absorption rate. This rate is computed using budgeted overhead and budgeted activity level.

As a result of this, overhead charged to total units product might be over or under absorbed compared to the actual amount incurred.

Over applied overhead = Applied overhead - Actual overhead

= 42,000,000 - 40,300,00 = 1,700,000

Over applied overhead = $ 1,700,000

The adjustment required is to reduce the cost of gods sold by the amount of over-applied overhead because the cost of goods sold figure is would have over charged.

Hence, closing over overhead into Cost of Goods Sold would cause net income to increase by $ 1,700,000 because net income and cost of Goods Sold are inversely related.

4 0

3 years ago