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Andreas93 [3]
3 years ago
14

As the price level declines along the aggregate demand curve, the interest rate is most likely to:___________.

Business
1 answer:
lbvjy [14]3 years ago
3 0

Answer:

a. Decline

Explanation:

Whenever there is a reduction in the price level, this results in gains in the real money supply which eventually moves the LM curve to the right.

Hence, given that, the IS curve has a downward slope, the IS and LM curves will meet at a higher level of income and a lower interest rate.

Therefore, the correct answer, in this case, is Option A: DECLINE

Note LM means Liquidity and Money

While IS means Investment and Savings.

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Your investment portfolio consists of ​$15 comma 000 invested in only one stocklong dashAmazon. Suppose the​ risk-free rate is 5
Kay [80]

Answer:

a)

The CAPM hypothesis states that the effective market is utilized place in the market and has the maximum eminent expected return of any assortment for a given randomness and the smallest variability for a assumed expected return. By allotment utilized place in the market assortment, you can achieve a standard return,

Thus,  

Expected Rate of Return = [Risk free Rate + Beta × (Market Risk - Risk free Rate)]

Beta = [Expected Rate of Return – Risk Free Rate] / [Market Risk - Risk free Rate]

Beta = [12% - 5%] / [10% -5%]

Beta = 7/5

Beta =1.4

The final possible instability while taking the same estimated rate of return as Amazon is $21,000 ($15,000 × 1.4) which indicate that it borrows $6,000 ($21,000 - $15,000). Now the -$6,000 is specified as strength benefit. So the volatility of the asset is,

Volatility = [Volatility of Asset x Beta]

Volatility = [18% × 1.4]

Volatility = 0.252 or 25.20%

Therefore the volatility is less than the volatility of Amazon.

b)

The market share has a instability of "n". The corresponding instability of Amazon will be 2.22 (40%/18%). So the assortment with the most notable predictable give back that has a faint variability from Amazon is $33,333.33 ($15,000x 2.22) which will be the market assortment and it also uses $18,333.33 ($33,333.33 - $15,000). Here the -$18,333.33 is specified as strength asset. So the return is,

Expected Return = [Risk free Rate + Beta × (Market Risk – Risk free Rate)]

Expected Return = [5%+ 122 × (10% - 5%)]

Expected Return = [5%+ 122 × 5%]

Expected Return = [0.05+0.111111]

Expected Return = 0.161111 or1 6.11%

Therefore the volatility is higher than the expected return of Amazon.

8 0
3 years ago
Complete each sentence by selecting the correct term using the drop-down list.
Tomtit [17]

Answer:

FOB destination means "Free on Board Destination.

1. Goods transit shipped to Abbey (purchaser) FOB Destination

Answer: Exclude from inventory

2. Goods in transit shipped to Abbey (purchaser) FOB Shipping Point

Answer: Include in inventory count

3. Goods transit shipped by Abbey (seller) FOB Destination

Answer: Include in inventory

4. Goods in transit shipped by Abbey (seller) FOB Shipping Point

Answer: Exclude from inventory

6 0
3 years ago
How does availability of complements act as a value driver?
wariber [46]

Actually the role of complement products is to enhance the satisfaction that is given with the other product. For example, the complement of a loaf of bread would be peanut butter or a strawberry jam. The amount of satisfaction is enhanced when eating bread with peanut butter. Therefore the answer is:

<span>D. complements add value to a product when they are consumed in tandem with it</span>

6 0
3 years ago
Someone who diversifies investments is more likely to
AnnZ [28]

Answer:

offset their losses with gains.

Explanation:

8 0
3 years ago
Read 2 more answers
Madison Park Co-op, a whole foods grocery and gift shop, has provided the following data to be used in its service department co
REY [17]

Answer:

Total cost Groceries department 4,103,238

Total cost Gif department 366,763

Explanation:

\left[\begin{array}{ccccc}&Administration&Janitorial&Grocerys&Gifs\\$employee hours&&350&2690&160\\$square feet&&&9200&800\\Direct \: Cost&190000&70000&3860000&350000\\$Allocate A&-190000&20781.25&159718.75&9500\\$Subtotal&&90781.25&4019718.75&359500\\$Allocate J&&-90781.25&83518.75&7262.5\\$Total&&&4103237.5&366762.5\\\end{array}\right]

Adminstration cost will be distributed among Janitorial, Groceries and Gifs

we add up the employee hours:

350 + 2690 +160 = 3200

Then, we cross multuply:

190,000 x 350/3200 = 20781.25

190,000 x 2690/3200 = 159718.75

190,000 x 160/3200 = 9500

we add them to their cost and then do the same for Janitorial.

9200+ 800 = 10,000

90781.25 x 9200/10000 = 83518.75

90781.25 x 800/10000 = 7262.5

giving the total cost of the operating departments.

7 0
3 years ago
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