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kirill [66]
3 years ago
5

Suppose that consumer spending initially rises by $5 billion for every 1 percent rise in household wealth and that investment sp

ending initially rises by $20 billion for every 1 percentage point fall in the real interest rate. Also assume that the economy�s multiplier is 3. If household wealth falls by 6 percent because of declining house values, and the real interest rate falls by 2 percentage points, in what direction and by how much will the aggregate demand curve initially shift at each price level? The aggregate demand curve will shift_____ by $____ billion. In what direction and by how much will it eventually shift? The aggregate demand curve will shift_____ by $____ billion.
Business
1 answer:
enyata [817]3 years ago
7 0

Answer:

left by 30 billons

then right by 40 billons

Explanation:

the aggregate demand curve will move to the left as the consumption of the economy will fall as the household are less wealthy than before.

Then, as the interest rate fall the aggregate demand curve will move to the right as the investing increase as now more projects are profitable.

<em>Calculations:</em>

<em />

5 billon for every point of wealth:

6 points x 5 billon = 30 billons

20 billion of inventing per 1% of interest rate decrease

2 points x 20 billions = 40 billons

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mihalych1998 [28]

Answer:

Explanation:

Net cash provided by operating activities 140,000

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Free cash flow 49,000

3 0
3 years ago
Wave Fashions uses standard costs for its manufacturing division. The allocation base for overhead costs is direct labor hours.
horsena [70]

Answer:

B. $ 3,650 U

Explanation:

Wave Fashions

Actual fixed overhead $ 32,000

Budgeted fixed overhead $ 26,000

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Standard overhead allocation rate $ 6.75

Standard direct labor hours per unit 2.1 DLHr

Actual output 2,000 units

Total Fixed Overhead Variance =  Budget Variance + Volume Variance

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Budget Variance = Actual Fixed Overhead- Budgeted Fixed Overhead= $ 32,000- $ 26,000= $ 6000 unfavorable

Volume Variance = Budgeted Fixed Overhead- Allocated Fixed Overhead

Volume Variance= $ 26000-  ( Standard Fixed Overhead Rate * Standard Hours)

Volume Variance= $ 26000-  ( $ 6.75 * 2.1 * 2000)

Volume Variance= $ 26000- 28350 = 2350 favorable

6 0
3 years ago
​Valley, Inc. has​ 9,000 shares of preferred stock outstanding. The preferred stock has a​ $90 par​ value, a​ 14% dividend​ rate
EastWind [94]

Answer:

The dividends payout to preferred stockholders is $113,400 as shown below.

Explanation:

The total dividends payable to holders of preferred shares can be computed thus:

Preferred shares dividends=9000*$90*14%

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Preferred shareholders have prior claims to dividends ahead of ordinary shareholders,but after bondholders' interest payments have been settled.

The same way they also have precedence in the distribution of company's assets before ordinary shareholders upon the liquidation of the company.

The downside is that they cannot share in excess profits after payment of dividends as they are part-owners of the company unlike ordinary shareholders.

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A fiduciary relationship is a role of belief, and the agent owes the principal the obligation of obedience, loyalty, disclosure, confidentiality, accounting, and reasonable care (old automobile).

Fiduciary duty is defined by means of Black's regulation Dictionary as “an obligation of extreme precise religion, belief, confidence, and candor owed by using a fiduciary (which includes an attorney or corporate officer) to the beneficiary (which includes a lawyer's purchaser or a shareholder); a responsibility to act with the highest degree of honesty and loyalty towards any other .

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