Answer:
The money multiplier of the economy is 20
Explanation:
Money multiplier is the term of economics which is defined as the maximum amount, the money supply could rise grounded on the increase in the reserve in the system of banking.
The formula used for computing the money multiplier is as:
Money Multiplier = 1 / r
where
r is the reserve ratio that is 5%
So, putting the same value above:
Money Multiplier = 1 / 5%
Money Multiplier = 20
Answer:
The answer is: D) With increases in technology, the aggregate production function shifts up, indicating more output is produced from the same amount of inputs.
Explanation:
Technological improvements in new manufacturing machines and tools enable the production of more manufactured goods using the input. As technology increases, the production function shifts upward, is steeper, and the marginal product of capital increases.
Answer:
Number of units required for the two operations to break even= 907 (approx)
Answer:
The answer is a. $25.00
Explanation:
The bondholder's cash flow in one-year time from holding a TrunkLine's bond is calculated as:
(The possibility of TrunkLine doing well x Repayment receipt in case TrunkLine doing well) + (The possibility of TrunkLine doing poorly x Repayment receipt in case TrunkLine doing poorly) = (0.5 x 35) + (0.5 x 20) = $27.50.
The current price bondholders are willing to pay for a bond is equal to the present value of a bond's cash flow in one-year time, discounted at the interest rate on the bond 10% which is calculated as below:
27.50 / (1+10%)^1 = $25
Thus, the correct choice is a. $25.00
