Answer: b) Investment demand had been greater than savings
Explanation:
Investment in the economy comes from savings by households also known as Loanable funds. If investment demand is higher than the savings supply this demand will pull the interest rate up due to a lack of loanable funds.
As the interest rates are pulled up, more people will be encouraged to save their money in other to benefit from the higher interest rates thereby increasing the loanable funds in the market.
Answer:
The correct option is is A, predatory pricing
Explanation:
Predatory pricing is an illegal approach to pricing where a firm fixes a very low price in order to send competitors out of business.
This is very applicable to a firm that has economies of scale where its cost per unit reduces as more and more units are produced, making it possible to undercut competitors without feeling much impact in profitability.
This approach is against the anti-trust law as it paves for a monopoly market,where only one firm operating in the market determines the price which is not likely to be favorable to consumers
Answer:
Decrease in Bank balance and increase in fixed assets
Explanation:
When a new depreciable asset is purchased, the money leaves the bank account hence reducing the bank balance in the statement of financial position, and on the other hand the 'Fixed asset' balance will rise by the same amount; recognizing the addition to the assets of the company. In this scenario the balance sheet totals remain unchanged as the same amount has been subtracted from 'bank' and added to 'fixed assets' all within the asset side.
However, if the asset is debt financed, it will increase the long term liability figure because 'bank loan' will be recognized. Hence the totals of the balance sheet will rise by the amount of the loan on the 'Capital and liabilities' side and the amount of the asset on the 'Asset' side.
Another impact is that the amount of depreciation charged to the Income Statement will be higher than $2,946,667 which was charged in the previous year because the new asset's depreciation will have to be added.
Answer:
2. When people spend money, that money ends up In the pockets or bank accounts of other people (or organizations) who then use that money in some way.
Explanation:
In the economy exist different types of agents: people, government and enterprises. No more.
M9ney spent on household expenses
