Answer:
the long-run framework directs one to avoid deficits; in the short-run framework deficits are useful if the economy is significantly below potential.
Explanation:
"Budget deficits should be avoided, even if the economy is below potential, because they reduce saving and lead to lower growth." This policy directive follow the long-run framework directs one to avoid deficits; in the short-run framework deficits are useful if the economy is significantly below potential.
<u>The reason is that in the short-run, deficits offer economic solutions by being an antidote to recessions, hence they could be a strategy of recession management in the short run</u>
<u>However in the long-run, deficits are not advisable as they could lead to debts because the major way to manage such deficits is by external borrowings. </u>
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Answer:
Quantity of beef demanded will decrease by 12%
Explanation:
Data provided in the question:
Price elasticity of demand for beef, Ed = 0.60
Increase in the price of beef = 20%
Now,
Price elasticity of demand for beef,
Ed = [ Percentage change in Quantity ] ÷ [ Percentage change in price ]
or
0.60 = [ Percentage change in Quantity ] ÷ 20%
or
Percentage change in Quantity = 0.60 × 20%
or
Percentage change in Quantity = 12%
Also,
Price and Quantity are inversely proportional
Hence,
With the increase in price, the quantity will decrease
Therefore,
Quantity of beef demanded will decrease by 12%
Indicate whether it would appear on the statement of cash flows as operating activities.
There are three types of cash flow: operating cash flow, investment cash flow, and financial cash flow. Operating cash flow is generated from the company's normal operating activities. This includes cash proceeds from sales, cash outlays on goods sold (COGS), and other operating expenses such as overheads and salaries.
Investing cash flows include amounts spent to purchase securities intended to be held as investments, such as securities. B. Stocks or bonds of other companies or the Treasury. Inflows are generated by interest and dividends paid on these holdings.
Learn more about cash flows at
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Answer:
Adjusted COGS = $706,800
Adjusted retained earnings = $1,185,200
Explanation:
Opening stock + purchases - Closing stock = Adjustment needed to COGS
- 48,000 + 0 - (-64,800) = Adjustment needed to COGS
-48,000 + 64,800 = Adjustment needed to COGS
Adjustment needed to COGS = $16,800
Adjusted COGS = $690,000 + $16,800 = $706,800
Adjusted retained earnings = $1,250,000 - 64,800 = $1,185,200
