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
pochemuha
3 years ago
12

Suppose consumption demand of GDP decreases during a recession while the other demands are unaffected. What happens to the equil

ibrium real interest rate in the economy?
Business
1 answer:
julsineya [31]3 years ago
7 0

Answer:

Since consumption represents almost 70% of the GDP, any change in consumption affects the economy more than any change in the rest of the components of the GDP (net exports, investment, government). If consumption decreases, then the real interest rate will decrease.

The higher the interest rate, the lower the consumption level. This should increase the savings = more investment in the economy, but since consumption is so important to the economy, a decrease in consumption will decrease the equilibrium interest rate. This lowering in the real interest rate will be carried out in order to try to increase consumption.

You might be interested in
You just invested $1000 in an account that returns 5% per year. After 50 years, when you are old and gray, what will be the valu
nikitadnepr [17]
Jahsjsjshsnsjdjjshsnananaa
3 0
3 years ago
Read 2 more answers
Do the following activities contribute to US GDP in 2020? Explain why or why not? In which year do these activities contribute t
ale4655 [162]

Answer:

Explained below.

Explanation:

In option (a) no it does not contribute to the US GDP in any year. The transaction appears in expenditure as an increase in consumption and a decrease in net exports that offset. According to option (b) yes it contributes to US GDP in 2013. The transaction appears as an increase in investment (increase in inventory). In 2014, the transaction appears as an increase in net exports offset by a decrease in investment. According to option (c), the transaction appears in expenditure as an increase in consumption in 2014 offset by a decrease in net exports. Option (d) represents the transaction appears as an increase in investment (increase in inventory). In 2014, the transaction appears as an increase in consumption offset by a decrease in investment. According to option (e) yes, it contributes $1000 to US GDP in 2014. The $6000 purchase price exceeds the price paid by the used car dealer. The difference represents value added by the dealership - this is a service that should be counted as part of GDP.

8 0
3 years ago
On the _________________________date, the dividend to be paid is recorded as a _______________________, and retained earnings ar
umka21 [38]

Answer: The answers are DECLARATION; LIABILITY; REDUCED; HOLDER-OF-RECORD DATE

Explanation: Dividend is a sum of money aid regularly by a company to its owners. A Stockholder listed as an owner on the holder-of- record date is entitled to dividend when declared.

When a dividend is declared, it is stated as a liability as it becomes a debt to the organisation. This dividend payable is taken from the retained earnings of the organisation.

7 0
3 years ago
An investor just purchased a 10-year, $1,000 par value bond. the coupon rate on this bond is 8 percent annually, with interest b
cupoosta [38]

i think it is $875.38

7 0
3 years ago
Your boss makes an intentional effort to understand the emotion or mood of the office at all times. Your boss uses that informat
tankabanditka [31]

Answer:

The correct answer is: emotional intelligence.

Explanation:

To begin with, the concept of<em> "emotional intelligence"</em>, in the field of business, refers to the capability of individuals to recognize their own emotions and also the ones of the others around him, in order to use that information with the purpose of guiding or leading the thinking and behavior of the group or team in order to establish better results when working together as a whole. That is why, when your boss is making an intentional effort to understand the emotions of all the office and use that information to assign the teams, then he is using the emotional intelligence to work better.

6 0
3 years ago
Other questions:
  • Distributor packages and sells two types of products, A and B. The respective sales prices for the products are $10 and $5. The
    11·1 answer
  • 1. Which of the following best explains why zoos are not affected by the threats of new entrants?
    9·1 answer
  • When looking at the statistics and opportunities available to college graduates you see that college graduates
    12·2 answers
  • You are opening up a brand new retail strip mall. You presently have more potential retail outlets wanting to locate in your mal
    6·1 answer
  • Around which latitude(s) would you expect to find rainforests, and why? ( you may enter up to 150 characters. )
    6·2 answers
  • Druganaut company buys a $21,000 van on credit. the transaction will affect the
    6·1 answer
  • which of the following is the features of memorandum. (a) no salutation (b) dear ma/sir (c) it contains letter headed paper (d)
    12·1 answer
  • A buyer properly revokes the offer after receiving the property condition disclosure and requests the return of the buyer's earn
    9·1 answer
  • If a good's production process results in pollution and the government taxes producers to pay for cleanup costs, then :______
    10·1 answer
  • 32. Peter must decide if he should add one more dog to his dog-walking business. What is this decision an
    8·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!