Answer:
Macmillana's GDP is less sensitive economic fluctuations than Bloedelo's GDP. Two reasons account for this:
1) The keynesian multiplier is smaller.
The keynesian multiplier tells us about the sensitivity of GDP to increases in domestic expenditure (consumption, investment or government purchases). If the keynesian multiplier is small, then, GDP will be less sensitive to fluctuations in aggregate expenditure.
2) Macmillana's economy has implemented automatic stabilizers, while Bloedelo's economy has not.
Automatic Stabilizers are government policies meant to reduce fluctuations in GDP. The two most common automatic stabilizers are: income taxes and unemployment benefits.
Automatic Stabilizers reduce the kenyensian multiplier, dampening Macmillana's GDP sensitivity to fluctuations even more.
Answer:
Therefore after 16.26 unit of time, both accounts have same balance.
The both account have $8,834.43.
Explanation:
Formula for continuous compounding :
P(t)= value after t time
= Initial principal
r= rate of interest annually
t=length of time.
Given that, someone invested $5,000 at an interest 3.5% and another one invested $5,250 at an interest 3.2% .
Let after t year the both accounts have same balance.
For the first case,
P= $5,000, r=3.5%=0.035
For the second case,
P= $5,250, r=3.5%=0.032
According to the problem,
Taking ln both sides
Therefore after 16.26 unit of time, both accounts have same balance.
The account balance on that time is
=$8,834.43
The both account have $8,834.43.
Answer: Diversification
Explanation: Diversification strategy involves widening the scope of the organization across different products and market sector. Furthermore, it is used to expand firms operations and productivity by adding markets, products, services, or stages of production to the existing business and the main aim of diversification is to minimize the risk by investing in range of products. It helps in reducing the market volatility.
Answer: a. 15%
b. Initial Cost divided by Annual Net Cash Inflow
Explanation:
1. Cost of new machine = $800,000
Residual value = $0
Estimated total income from machine = $300,000
Expected useful life = 5 years
Average rate of return on this asset will be calculated thus:
Firstly, we'll calculate the net income per year = Total net income / Number of years = $300000/5 = $60000
Average investment = $80000/2 = $400000
Average rate of return = Net Income per year / Average investment = $60000/$400000 = 0.15 = 15%
2. Cash payback period is computed as the initial cost divided by the annual net cash inflow. It is the amount of time that is required for the cash inflows that is generated by a particular project to be able to offset its initial cash outflow.
In a pure competition market, all products that being sold in that market is EXACTLY the same. None is worse and none is better.
In that condition, Buyers will make their decision based on price ( since all product's quality is possible)
That's why producers should sell where p=MC, which mean they should sell in the lowest price possible to be able to compete with other competitors
