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prisoha [69]
3 years ago
6

Suppose equilibrium savings equals $750 billion, and equilibrium GDP equals $3,500 billion. Investment spending rises to $900 bi

llion, and equilibrium level of real GDP increases by $500 billion. Assuming everything else remains constant, the value of the spending multiplier is?
Business
1 answer:
aleksandr82 [10.1K]3 years ago
7 0

Answer:

Multiplier = 3.33

Explanation:

Investment / Spending Multiplier denotes increase in Income multiple times increase in causal Investment.

Multiplier = Change in Income / Change in Investment = 1 / 1 - MPC

<em>M</em> = ΔY/ΔI = 1/ (1-MPC)

At Equilibrium, Investment = Savings = 750. Change in Investment = 900 - 750 = 150. Change in Income = 500.

M = 500/150 = 3.33

3.33 = 1/(1-MPC)

MPC = 0.70

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Merowak Missiles has developed its Democratizer Offensive Weapon System (DOWS) for the US military. After sinking $1 billion int
balu736 [363]

Answer:

$100,000,000

Explanation:

To calculate relevant break even cost point we ignore all the sunk funds and fixed costs that have already been paid.

This includes,

R&D funds of $1 billion

Tools of $0.5 billion

Factory of $1 million

None of these are the relevant or incremental costs and thus to calculate break even for this order, they will be avoided.

The Break even cost = 50,000 * 2000 = $100,000,000

We only account for the cost of producing each additional unit that is the Marginal Cost of $2,000/missile.

Hope that helps.

4 0
3 years ago
Advertising begins with the ________, the person or organization that uses advertising to send out a message about its products.
irina1246 [14]

Answer:

<u>Advertiser</u>

Explanation:

Advertising refers to promoting a product or a service with an objective to enhance it's sales and identify the prospective buyers of a product.

Advertisement medium may include , print media advertisements such as journals, newspapers, catalogs, posters, magazines, etc.

Advertising may also utilize visual space and audio means such as advertisements on radios, televisions, internet, etc.

The process begins with the advertiser who is usually the seller, refers to a person or an organization desirous of selling it's products.  The seller decides the method of advertisement as per the kind of products he/she deals in and the cost he/she is willing to bear, since advertisements can be very costly.

The advertiser can be simply defined as the payer for the advertisement.

3 0
3 years ago
After preparing and posting the closing entries for revenues and expenses, the income summary account has a debit balance of $36
ahrayia [7]

Answer:

Debit Retained earnings $36,000; credit Income Summary $36,000

Explanation:

The income statement has its last line as the net income/loss for the period.  The income summary account is closed into the retained earnings.

The expense in the income statement is closed by crediting the account and debiting the income summary. For revenue, the account is debited and the income summary is credited.

Hence  where the income summary account has a debit balance of $36,000, the entries to close it will be Debit Retained earnings $36,000; credit Income Summary $36,000

6 0
4 years ago
Identify the financial statement (or statements) in which each of the following items would appear: income statement (IS), state
cricket20 [7]

Answer: Income statement shows the performance for the year. Balance sheet shows the financial position at the end of the year. Cash flow statement shows the sources and uses of cash.

Explanation: From the above we can categorize the given elements as follows:-

A. assets = balance sheet

B. revenues = income statement

C. cash flow from investing activities =  cash flow statement

D. Stockholders equity = Balance sheet

E. Expenses =  income statement.

F. Net change in cash = cash flow statement

G. Net income = Income statement

H. Liabilities = Balance sheet

8 0
3 years ago
Suppose the demand for a particular product can be expressed as Q = 100/p. Calculate the total amount spent on this good when p
natulia [17]

Explanation:

92.00 spent on q product

3 0
4 years ago
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