Answer:
It has no effect
Explanation:
M1 includes the currency and checking accounts. The bank account will decrease by 200 (cheking deposit) and increase currency by 200. So it will be the same as before the transactions.
The M1 money supply will not change as a result of this transaction.
In other words, M1 contains cash and near cash equivalent, this transaction do not increase or reduce these concepts.
Answer:
$3,000
Explanation:
Calculation for the increase the money supply
Using this formula
Increase in money supply=(Cash/Reserve ratio)-Cash
Increase in money supply=($1,000/0.25)-$1,000
Increase in money supply=$4,000-$1,000
Increase in money supply=$3,000
Therefore based on the information given the banking system can increase the money supply by $3,000
Answer:
B. Scenario analysis
Explanation:
Just like the name implies, it involves the analysis or description of various possible outcomes/action/events in the future. It is the process of analyzing future event by considering alternative possible outcomes.
It estimates the expected events.
After the failures suffered by PPG, they thought it better to use a technique that predicts possible occurence in order to avoid a repetition of those failures.
Answer: Option (C) is correct.
Explanation:
There is a adjustment entry for depreciation of $3,545 but the amount that is debited as depreciation expense is different from the amount that is credited as accumulated depreciation.
Depreciation Expense A/C Dr. $3,454
To Accumulated Depreciation $3,545
This will lead to an unequal adjusted trial balance.
Option 'A' and 'B' has no effect on the adjusted trail balance to be unequal because whole transaction is omitted.
Option 'D' also has no effect on adjusted trail balance because the debit and credit amount will still match.
Answer:
The increase in demand of the product with the higher price or decrease in demand for the other goods is because the substitution effect is outweighed by the income effect of price increase.
Explanation:
The above explanation in economics refers to Giffen Good. The idea behind this concept Giffen is that if you do not have money and there is an increase in the price of a fundamental product such as bread, it is still impossible to afford other alternatives, hence you will go ahead to buy bread or avoid buying any of the product. Hence, the demand for other product will also decrease in this case. This means that the demand for product with higher price or decrease in other substitute product is due to the fact that the income effect outweighs the substitution effect. Hence people do not have the money to even afford the alternative product.
