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Cloud [144]
4 years ago
9

If the marginal propensity to consume is 0.30 , what is the multiplier, assuming there are no taxes or imports

Business
1 answer:
ollegr [7]4 years ago
3 0

Answer:

Multiplier or k = 1.428571429 rounded off to 1.43

Explanation:

A change in consumer income leading to an increased consumer spending based on the Marginal propensity to consume or MPC can have a much larger effect in the economy due to the multiplier. A multiplier is the is the amount of new income that is generated form an addition of extra income.

The marginal propensity to consume or MPC is the percentage of the additional income that will be used for consumption spending. The formula to calculate the multiplier, also denoted as k, is:

k = 1 / (1 - MPC)

k = 1 / (1 - 0.3)

k = 1.428571429 rounded off to 1.43

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When the Fed does repos and reverse repos (or repurchase agreements) with financial institutions, the collateral used in these t
MatroZZZ [7]

Answer:

U.S. Treasury bonds.

Explanation:

Repurchase agreements can take place between a variety of parties. The Federal Reserve enters into repurchase agreements to regulate the money supply and bank reserves.

This are open market operation and the Treasury bonds are the collateral

3 0
3 years ago
. Based on the following data, Accounts payable…………………………………………………..... $62,000 Accounts receivable…………………………………………………. 100,000
Temka [501]

Answer:  $428,000

Explanation:

Given that,

Accounts payable = $62,000

Accounts receivable = 100,000

Cash = 30,000

Inventory = 138,000

Land = 160,000

Common Stock = 200,000

Revenue = 80,000

Dividends = 56,000

Expenses = 40,000

Total assets = Accounts receivable + Cash + Inventory + Land

                     = 100,000 + 30,000 +  138,000 + 160,000

                     = $428,000

3 0
4 years ago
Suppose that mr. green jeans sells $5,000 of wheat to big ben bakery. big ben uses the wheat to make flour and then hamburger bu
natta225 [31]

The gross domestic product (GDP) measures the monetary status of the market value of all final goods and services. With this definition therefore, the GDP of all these transactions only account the selling the final product, hamburger.

Add to GDP = 10,000 * $5

Add to GDP = $50,000

7 0
4 years ago
Assume the market for manufactured houses is in equilibrium. Imagine that trade restrictions increased the cost of cement, which
xeze [42]

Answer: f. Supply of manufactured houses shifts leftward and manufactured houses increase in price

Explanation:

All else being equal, when the price of an input into the production process increases, it makes producing the goods in question more expensive and so producers will respond by reducing production levels to maintain Profitability.

As the price of cement rises, making manufactured houses becomes more expensive and so the makers of manufactured houses will reduce the number of manufactured houses they make. This will reduce Supply thereby shifting the Supply Curve to the left. The new Equilibrium level will indicate a higher Equilibrium price as shown in the attached graph.

7 0
3 years ago
Boss Enterprises currently sells its products for per unit. Management is contemplating a ​% increase in the selling price for t
devlian [24]

Answer: 5,000 units

Explanation:

Break-even points in units is calculated by;

= Fixed Costs / Contribution Margin per unit

Contribution Margin

= Sales - Variable Costs

= $40 - ( 40 * 40%)

= 40 - 16

= $24 per unit

Breakeven point

= 120,000/24

= 5,000 units

5 0
3 years ago
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