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Katena32 [7]
3 years ago
13

Suppose aggregate consumer spending equals $5,000 when aggregate disposable income is zero. Furthermore, suppose that when dispo

sable income increases from $300 to $400, consumer spending increases by $70, and that this relationship between a change in disposable income and its effect on consumer spending is predictable and constant. If aggregate disposable income equals $2,000, then which is the value of aggregate consumer spending? A) $5,140 B) $6,400 C) $7,000 D) $19,000
Business
1 answer:
Margarita [4]3 years ago
6 0

Answer:

B) $6,400

Explanation:

The equation for the aggregate consumption spending function:

  • C = $5,000 + [$70 / ($400 - $300)] YD = $5,000 + ($70 / $100) YD = $5,000 + 0.7 YD

If YD = $2,000

total value of aggregate consumer spending = $5,000 + (0.7 x $2,000) = $5,000 + $1,400 = $6,400

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When two countries specialize in producing the goods for which they have a comparative advantage and?
olasank [31]

It can be mutually advantageous for two nations to specialize in goods for which they have a relative advantage and then trade with one another. Absolute advantage is the basis of the potential gains from specialization and trade.

<h3>What does it mean for a producer to have comparative benefit?</h3>

Comparative advantage is a requirement of a producer where it is better suited for the production of one good than another good. Good A can be made more efficiently than good B, for example. This comparison is done in terms of the option costs of each good, not in terms of pure production costs.

To learn more about Comparative advantage , refer

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3 0
2 years ago
The Closed Fund is a closed-end investment company with a portfolio currently worth $200 million. It has liabilities of $3 milli
slega [8]

Answer:

a. $39.40 per share

b. 8.63%

Explanation:

a. The computation of the NAV of the fund is shown below:

= (Assets - liabilities) ÷ (Number of outstanding shares)

= ($200 million - $3 million) ÷ (5 million shares)

= ($197 million) ÷ (5 million shares)

= $39.40 per share

b. The computation of the  premium or discount as a percent of NAV is shown below:

Since the selling price is $36 but its NAV is $39.40

So, the discount would be equal to

= $39.40 - $36

= $3.40

The discount percentage equals to

= $3.40 ÷ $39.40

= 8.63%

5 0
4 years ago
QUESTIONS
Snezhnost [94]

Answer:

11) payment history ; 111) Amounts owed

Explanation: An individual's credit score is of great importance in determining if a person should be given a loan or not. The credit score is reliant on factors such as ; the level of debt or amount owed by the account owner and the repayment history of the individual. These information are used to enable the borrower qualify for a loan while also providing the lender requisite information in evaluating if the borrower is credit worthy. An individual with a poor and untimely debt repayment history coupled with a high debt value will have a low credit score thereby hampering such individual's chances of qualifying for a loan. Similarly, borrowers with good and timely repayment history and devoid of debt may have higher chances of qualifying for more robust and long term loans.

5 0
3 years ago
Imagine that a local water company issued $10,000 ten-year bond at an interest rate of 6%. You are thinking about buying this bo
mylen [45]

Answer:

Explanation:

The $10,000 is the face value of the bond. Using a financial calculator, input the following to calculate the price at a year before maturity; i.e. at year 9;

Time to maturity; N = 10 - 9 = 1

Annual interest rate; I/Y = 9%

Annual coupon payment; PMT = 0

Face value of the bond; FV = 10,000

then compute present value ; CPT PV = $9,174.31

Therefore, you will pay less than $10,000 for the bond and the price would be  as above $9,174.31

6 0
3 years ago
The lesson of easter island was that ________. economics is an important facilitator of sustainable societies conservation of re
Arada [10]

The lesson of eastern island was that conservation of resources is necessary for sustainable societies. Easter Island was specified the name rapa nui or great rapa by tahitian sailors in the 1860’s, as it reminded them of rapa which is a small island in french polynesia and now commonly referred to as rapa iti. T<span>he story of the easter islanders is tragic but at the same time a good lesson for all of the people. They had a highly industrialized civilization for about 600 years but ignored the environmental consequence of their standard of living and broken down in catastrophe. </span>

8 0
4 years ago
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