Answer:
Decrease the money supply from $120 to $100
Explanation:
If the monetary authorities reduces aggregate demand from AD3 to AD2, money supply decreases from $120 to $100. This decrease will cause a decrease in consumer spending. There will be a reduction of price levels and real output.
This is also called contractionary monetary policy and it causes interest rate to be higher there by reducing investments.
Answer: $942 U
Explanation:
Budgeted cost was $2,960 per month plus $326 per day and there were 18 days of actual activity.
Budgeted cost = 2,960 + 326 * 18
= $8,828
Variance = Budgeted cost - Actual cost
= 8,828 - 9,770
= -$942
Budgeted cost is less than Actual cost which means the Variance is UNFAVORABLE.
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Answer:
A) interest rates will rise.
Explanation:
When the FED buys US securities it is carrying out an expansionary monetary policy. It reduces the interest rate of US securities so that more investors are willing to sell their US securities to the FED since their rate of return is very small.
If the FED stops buying back US securities, it means that they will stop their expansionary monetary policy, so the FED will start to increase US securities' interest rates. That way investors will be willing to keep their US securities and will not sell them since their rate of return has increased. This increase in the interest rate will lower the price of US securities and decrease the money supply.
Answer:
$47,200
Explanation:
For computing the budgeted purchase, first we have to determine the purchase unit which is shown below:
= Sale units + ending inventory units - beginning inventory units
where,
Sale units are 1,300 units
Ending inventory units = 900 units × 30% = 270 units
Beginning inventory units = 1,300 × 30% = 390 units
Now put these units to the above formula
So, the units would equal to
= 1,300 units + 270 units - 390 units
= 1,180 units
Now the budgeted purchase would be
= 1,180 units × $40
= $47,200
