1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
VMariaS [17]
3 years ago
10

The fundamental relationship between savings and investment spending in an economy is that: A. savings will increase as investme

nt spending decreases. B. investment spending and savings are always equal. C. investment spending promises higher financial returns than savings. D. savings will decrease as investment spending increases.
Business
1 answer:
Romashka-Z-Leto [24]3 years ago
8 0

The correct option is B

<u>Explanation:</u>

In an economy, planned investment spending is always equal to planned saving. If actual saving falls short of (exceeds) planned saving, then actual investment falls short of (exceeds) planned investment.

That is the other part of the saving paradox. If an economy produces too much, such that saving is greater than planned investment, inventory will build up, giving signal to producers to reduce output, to restore equilibrium. Such investment scheme is suitable only to communist countries. Keynes has another investment theory in his liquidity story. But investment theories are equally a posterior.

Therefore, Option B is correct

You might be interested in
In a statement of cash flows, which of the following would be classified as an investing activity?
Elanso [62]

Answer:

C. The sale of equipment.

Explanation:

Investing activities: It records those activities that include the long-term asset buying and selling. The buying is a cash outflow while the sale is a cash inflow.

The cash outflow decreases the cash balance whereas cash inflow increases the cash balance. So the buying would be shown in a negative sign while the selling is shown in the positive sign

Hence, the correct option is C.

5 0
3 years ago
The present value of a single sum is: Select one: A. The amount that would be paid today to receive a single amount at a specifi
Marina86 [1]

Answer:

The correct answer is letter "A": The amount that would be paid today to receive a single amount at a specified date in the future.

Explanation:

The present value (PV) of a single sum tells us how much a future sum of money is worth today given a specified rate of return. This is an important financial concept based on the principle that money received in a specific time in the future is not worth as much as an equal sum received today.

8 0
2 years ago
You are considering the purchase of a certain stock. You expect to own the stock for the next four years. The current market pri
murzikaleks [220]

Answer:

The answer is: The expected rate of return from this investment is 26.68%

Explanation:

We are given the following cash flows for this operation:

  • Initial investment = -$24.50
  • Cash flow 1 = $1.25 (dividend year 1)
  • Cash flow 2 = $1.35 (dividend year 2)
  • Cash flow 3 = $1.45 (dividend year 3)
  • Cash flow 4 = $56.55 ($1.55 dividend year 4 + $55 stock's sales price)

Using an excel spreadsheet and the IRR function:

=IRR(value 1: value 5) =26.68%  

where

  • value 1 = -24.50
  • value 2 = 1.25
  • value 3 = 1.35
  • value 4 = 1.45
  • value 5 = 56.55

7 0
3 years ago
A company has two products: A1 and B2. It uses activity-based costing and has prepared the following analysis showing budgeted c
Mila [183]

Answer:

$4.00

Explanation:

To calculate the approximate overhead cost per unit of product A1 under activity - based costing we have it as

Activity 1 allocated to Product B2 line we have as

$48,000 × 4,800/6,000

= $38,400

Activity 2 allocated to Product B2 line we have it as

= $63,000 × 4,760/7,000

= $42,840

Activity 3 allocated to Product B2 line we have it as

=$80,000 × 800/8,000

= $8,000

Total overhead allocated to Product B2 = $89,240

Overhead per unit of Product B2: $89,240/22,310 = $4.00

As our overhead unit of product

4 0
3 years ago
Ms. Fresh bought 1,000 shares of Ibis Corporation stock for $5,400 on January 15, 2017. On December 31, 2019, she sold all 1,000
Setler [38]
Her loss is her loss
3 0
3 years ago
Other questions:
  • ___ integrity tests indirectly estimate employee honesty by measuring psychological traits.
    10·1 answer
  • Clara is looking into investing a portion of her recent bonus into the stock market. While researching different companies, she
    12·1 answer
  • _____ signs tell you how to drive safely in work zones.
    12·1 answer
  • When you tell an acquaintance your telephone number, you do not recite the digits one by one at a constant rate, as in "3, 3, 7,
    8·1 answer
  • Which statements are true about assessing the effectiveness of a strategic plan?
    12·1 answer
  • Describing a topic, idea, or concept you find so engaging that it makes you lose all track of time. Why does it captivate you? W
    8·1 answer
  • Electrodo Co. purchased land for $55,000 with $20,000 paid in cash and $35,000 in notes payable. What effect does this transacti
    15·1 answer
  • Swifty Company uses the units-of-activity method in computing depreciation. A new plant asset is purchased for $41000 that will
    10·1 answer
  • Over the past decade, medical costs have increased more rapidly than other prices. In order to illustrate how rising medical cos
    15·1 answer
  • Statement of Owner's Equity Zack Gaddis owns and operates Gaddis Advertising Services. On January 1, 20Y3, Zack Gaddis, Capital
    15·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!