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3 years ago

If aggregate planned expenditures in the economy increase by $100 million, then real GDP will _____ $100 million.

Business

1 answer:

nirvana33 [79]3 years ago

6 0

Answer:

Real GDP will rise by $100 million

Explanation:

Aggregate Demand [AD] is total amount of goods & services, all sectors of an economy are planning to buy . So AD = Aggregate Planned Expenditure [APE]

Aggregate Supply [AS] is total amount of goods & services, all sellers are planning to sell. As total output value of goods & services produced is distributed among factors of production, AS = National Income [NY] = GDP

At equilibrium : AD or APE = AS or NY or GDP

If AD or APE increases by $100 million :

AD or APE > AS or Aggregate Planned Production or GDP . This implies willingess to buy > willingness to produce. So, inventory levels will fall below desired level. To mantain inventory level, production [AS] & income level [GDP] will rise till it becomes equal to risen AD or APE

So, GDP will also rise by $100 million

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Explanation:

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3 years ago

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3 years ago

The average firm in each industry must have an m/b ratio that is equal to 1.0. true or false?

kumpel [21]

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3 years ago

Kevin invested $8,000 for one year at a simple annual interest rate of 6 percent and invested $10,000 for one year at an annual

sergejj [24]

Answer:

$1,296

Explanation:

To get the total amount he earned, we calculate the simple interest the first and compound interest on the second investment

For the first;

I = PRT/100

Where I = the simple interest

P is the amount invested called the principal

R is the yield percentage called the rate

T is time frame of investment

For the first investment:

I = (8,000 * 6 * 1)/100 = $480

For the second investment

A = P(1 + R/n)^nt

A is amount

P is principal

R is rate

n is number of times, 2 in this case since it is semi annually

t is time, 1 year in this case

A = 10,000(1 + 0.08/2)^2

A= $10,816

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3 years ago

A company is considering replacing an old machine, which has a market value of $75,000 and a tax basis of $50,000. The new machi

sp2606 [1]

Answer:

$90,500

Explanation:

The computation of initial cash outlay is shown below:-

initial cash outlay = New machine cost + Increase in working capital - After tax salvage value

= $145,000 + $12,000 - (($75,000 - ($75,000 - $50,000) × 0.34

= $145,000 + $12,000 - $66,500

= $90,500

Therefore for computing the initial cash outlay we simply applied the above formula.

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3 years ago