a. 50 cents
Contribution margin per unit is price per unit- variable cost per unit
1.75 - ($50,000/40,000 units)
1.75 - 1.25 = $ .50
b. $8750
Margin of safety is the expected sales - break even sales
(45,000 units * $1.75 per unit) - (40,000 *1.75)
78,750 - 70,000 = $8750
The job of the Federal Reserve System is to control the supply of money in the United States. Although it might seem like the Federal Reserve System prints the money as well, but this is in fact not true. The U.S. Treasury prints paper and coin currency and the Federal Reserve System distributes the money globally.
Because it takes<u> time</u> for people to find work in a society with poor information, frictional unemployment happens.
The unemployment that results from regular labor turnover, such as persons joining and leaving the labor force, as well as the continuous creation and destruction of jobs, is known as frictional unemployment. It comprises employees who are either looking for employment or holding out for a job soon.
Frictional unemployment has the following examples: employees looking for new jobs after quitting their existing ones, employees want to shift careers. Those looking for their first job after graduating from college or those starting their first career in the workforce.
To learn more about frictional unemployment
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Answer: The Ricardian equivalence theorem states that
: <u>"A. an increase in the government budget deficit has no effect on aggregate demand."</u>
Explanation: Ricardian Equivalence establishes that when the government increases the expenses financed with debt to try to stimulate the demand, this increase of the expenses does not produce any change in the demand.
This happens because the increases in the public deficit will be higher taxes in the future. Therefore, taxpayers reduce their consumption and increase their savings in order to offset the cost that will be the future tax increase.
