Answer:
The correct answer is: firms are unlikely to undertake investment.
Explanation:
The liquidity trap is a situation described in the Keynesian economy according to which, liquidity injections into the private banking system by the central bank do not lower interest rates or inject money into the economy and therefore do not stimulate economic growth as claimed by monetarism.
The liquidity trap occurs when people accumulate cash because they expect an adverse event, such as deflation, reduction in aggregate demand and GDP, an increase in the unemployment rate or a war. People are not buying, companies are not borrowing and banks are not lending either because they do not have enough solvency since the economic outlook is uncertain and investors do not invest because the expected returns on investments are low.
The most common characteristics of a liquidity trap are interest rates close to zero and fluctuations in the monetary base that do not translate into fluctuations in general price levels.
Answer:
Proportion of sales of each department.
Explanation:
Advertising expense directly effects the sales of the business. As the campaign is made store-wide sales and it does not directly traceable to any specific department. It need proper basis for allocation of expenses. The proportion of sales of each department is the most suitable basis from all of the given options because the share of benefit from the campaign is received in the form of sale. A campaign might mostly effects the sales.
Answer:
the income is $1,330
Explanation:
The computation of the income is shown below;
Given that
U(x, y) = min{x, y2}
Price of x is $25
ANd, the prcie of Y is $15
So,
25X + 15Y = M
if Y = 7,
So,
At eqm, X = Y^2 = 49
Then ,
M = 25 × 49 + 15 × 7
= 1225 + 105
= 1330
Hence, the income is $1,330
The same should be relevant and considered too
Answer:
P=$40
Explanation:
We will apply constant dividend growth model that is =P = D1 / ( k-g )
P is the price of share ?
D1 is the current divided $2
k is the rate of return 9%
G is the constant growth 4%
P=2/(9%-4%)
P=$40
