1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Leto [7]
3 years ago
14

Suppose the economy is in a recession. The economy needs to expand by at least $450 billion, and the marginal propensity to cons

ume is 0.9.
What is the least amount the government can spend to overcome the $450 billion gap?
Business
1 answer:
kumpel [21]3 years ago
7 0

Answer:

$45 billion

Explanation:

As per the data given in the question,

Marginal propensity to consume(MPC) = 0.9

Multiplier = 1 ÷ (1-MPC)

= 1 ÷ (1-0.9)

= 1 ÷ 0.1

= 10

Required change in money supply = $450 billion

Investment needed = Expansion ÷ Multiplier

= $450 ÷ 10

= $45 billion

Therefore, Least amount which can be spent by government to overcome the $450 billion gap = $45 billion

You might be interested in
Fred Hash worked for Van Stavern Construction Co. as a field supervisor in charge of constructing a new plant facility. Hash ent
Eduardwww [97]

Answer:

<em>Ratification by Principal One of the criteria for enactment is that all material truths involved in the transaction must be known to the Principal. Van Stavern was not aware of Hash's behaviour. </em>

He did not realize that somehow the steel is being shipped under his name, and that the shipments were being billed him directly. Unlike liability through obvious authority, approval by the principal is a positive act by which he or she acknowledges the agent's illegal actions.

Just a principal would ratify; thus, Van Stavern was not directly imputed to information by the invoices and checks signed by Van Stavern's workers.

The court stated that the use of corporate checks was further proof that Van Stavern regarded the expenditures as business, not private. So Van Stavern could not be held personally liable.

Remember that on Sutton Steel that's not excessively harsh. Sutton understood it was working with a building company and did not seek to get the personal approval of the contract from Van Stavern.

<em>Lawfully, Sutton's agreement in this case is called an unaccepted offer which can be withdrawn at any time.</em>

<em></em>

6 0
3 years ago
The Morrit Corporation has $1,080,000 of debt outstanding, and it pays an interest rate of 11% annually. Morrit's annual sales a
alukav5142 [94]

Answer:

3.020

Explanation:

Morrit Corporation

interest amount = $1,080,000*.11 = $118,800

Net profit = 3% *$6,000,000= $180,000

Net profit + tax = profit before tax =

180000/.75 = 240000

Profit before tax + Interest = Earning before interest and tax

= $240,000+$118,800 = $358,800

TIE ratio= EBIT/Interest = $358,800/118,800

= 3.020

Therefore the TIE ratio is 3.020

7 0
3 years ago
Mary jo spends $2,180 to buy stock in two companies. she pays $23 a share to one of the companies and $20 a share to the other.
Dahasolnce [82]
20was 40times. 23was 60times
5 0
3 years ago
Relationships influence the meanings that are given to words.<br> O True<br> O False
Elena-2011 [213]
......................True
4 0
3 years ago
Many in the advertising industry are calling for a new way to measure a commercial’s effectiveness, _____________, an accountabi
Vsevolod [243]

ROI is the answer to this question. ROI or Return of Investment is when the capital is now gained back and the business computes the amount of profit during the time the investment was returned. Return of investment is computed by dividing the benefit of investment over the cost of investment. 

6 0
3 years ago
Other questions:
  • Drag the tiles to the correct boxes to complete the pairs.
    14·1 answer
  • Jay Miller insured his pizza shop for $200,000 for fire insurance at an annual rate per $100 of $.49. At the end of 10 months, J
    5·2 answers
  • For each item listed below, indicate the allocation terminology for the item. Use the following terms for your answer:
    13·1 answer
  • Bank reconciliations are normally prepared on a monthly basis to identify adjustments needed in the depositor's records and to i
    14·1 answer
  • Calculate the ROE using the Strategic Profit Model for a company with the following data: Profit margin = 12% Total asset turnov
    9·1 answer
  • Using – to control rule-making agencies and increasing the size of the – staff have allowed presidents to use the administrative
    5·1 answer
  • Mr. Smith wishes to retire in 16 years. When he retires he would like to have $300,000 in his bank account. Mr. Smith's bank pay
    12·1 answer
  • The following credit sales are budgeted by Terra Co.: January $204,000 February 300,000 March 420,000 April 360,000The company's
    13·1 answer
  • Khái niệm giao tiếp trong tổ chức
    9·1 answer
  • Assume Fred faces a potential liability exposure. The standard deviation of the probability distribution for the loss equals $12
    9·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!