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andrew-mc [135]
3 years ago
13

Suppose that consumer spending initially rises by $5 billion for every 1 percent rise in household wealth and that investment sp

ending initially rises by $20 billion for every 1 percentage point fall in the real interest rate. also assume that the economy’s multiplier is 3.
a. if household wealth falls by 4 percent because of declining house values, and the real interest rate falls by 2 percentage points, in what direction and by how much will the aggregate demand curve initially shift at each price level?
Business
1 answer:
Ivan3 years ago
3 0
It will rise $80 billion if the household wealth falls by 4 percent.
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To raise operating funds, National Distribution Center sold its office building to an insurance company on January 1, 2021, for
QveST [7]

Answer:

1-Jan-21

Dr Cash $890,000

Dr Accumulated Depreciation $305,000

Cr Building $1,000,000

Gain On Sale of Building $195,000

1-Jan-21

Dr Right Of Use Assets $1,508,600

Cr Lease Payable $1,508,600

31-Dec-21

Dr Interest Expense $105,602

Dr Lease Payment $84,398

Cr Cash $190,000

31-Dec-21

Dr Amortization Expenses $84,398

Right Of Use Assets $84,398

Explanation:

1. & 2. Preparation for the appropriate entries for National Distribution Center on January 1, 2021 and December 31, 2021, to record the sale- leaseback and necessary adjustments

1-Jan-21

Dr Cash $890,000

Dr Accumulated Depreciation $305,000 ($1,000,000-$695,000)

Cr Building $1,000,000

Gain On Sale of Building $195,000

($890,000+$305,000-$1,000,000)

(To Record Lease)

1-Jan-21

Dr Right Of Use Assets ( $190,000* PVAF 7% for 12year)

($190,000*7.94) $1,508,600

Cr Lease Payable $1,508,600

(To Record The Lease Payable)

31-Dec-21

Dr Interest Expense ($1,508,600*7%) $105,602

Dr Lease Payment $84,398

($190,000-$105,602)

Cr Cash $190,000

(To Record First Lease payment)

31-Dec-21

Dr Amortization Expenses $84,398

Right Of Use Assets $84,398

(To Record Amortisation Expense)

4 0
3 years ago
2. Think of a real or made up but realistic example of a speculative risk that you or someone you know may face, and then answer
Advocard [28]

Answer:

See explanation section

Explanation:

a) Implementing an urban planning project is an example of speculative risk. There is a huge uncertainty before implementing a project as well as after its implementation regarding its gross outcomes. Projects of any type can completely fail. But there are some cases that they succeed; they may spawn some positive outcomes for a specific community. In any project, there is always a probability of both gain and loss.

b) There are a lot of possible adverse outcomes of this type of risk. Maybe the project is not running sustainably. The ground condition may not be suitable afterward, but inclement weather can reduce the desired project utilitarian. It can attribute an adverse impact on the present environment. Assume that the budget cross before the implementation of that project. Finally, these sorts of adverse outcomes may result in the project’s failure.

c) Project risk can also beget some positive outcomes. In this type of threat, after implementation of that project, it may run sustainably. The ground and atmospheric conditions may appear suitable for this specific project. The approved budget may consider sufficient for the project implementation. That is how; these sorts of positive outcomes may result in the project’s success.

d) These types of risks, both positive and negative, may create unexpected expenses. If we think about the real risks, to manage these risks, we should exploit, share and enhance the specific risk, And in case of managing the harmful risks, we should transfer into a better resource-based project or try to mitigate the negative impacts of the project. Both of these efforts can be considered as unexpected expenses.

e) To protect myself against the real risks, I’ll exploit the specific risk. Because operating the risk is about increasing the chances of positive effects, the risk may have on the project. But if it is about the detrimental risks, I’ll try to avoid the risks by doing some activities like delegating tasks, changing the deadline, and increasing the human resources of the project team.

5 0
3 years ago
Explain how the looting of shops and malls will affect businesses in terms of the relationship between the social responsibility
Reil [10]

Businesses decrease their incentives that will lead to minimizing their ability to carry out their part for social responsibility of the triple bottom line.

The bottom line is an obligation on businesses to not just look for their profit but include and maintain a good balance between these factors:

  • economic growth
  • social welfare
  • environment impact

Similarly, businesses need to follow the Triple bottom line in these ways:

  • Making profits
  • Making sure that there is positive social welfare on their part.
  • Maintain ecological footprint

Thus, by the looting of shops and malls, the ability of businesses to meet both their social responsibility and Triple bottom line is minimized and not as it was in normal conditions.

Learn more about social responsibility and Triple bottom line here: brainly.com/question/1339420

8 0
3 years ago
The best way to negotiate for an increase in starting salary is to _____. a. try to ask other employees at the company what they
defon
The best way for you to negotiate an increase in starting salary is to research similar jobs, note what their starting pay is, and provide the list to your boss. Most jobs will match what other people are paying because they need employees. The best way to lose your job right off the bat is to tell your boss that he is a cheapskate. I do not advise this.
5 0
3 years ago
Present value computation kerry bales won the state lottery and was given four choices for receiving her winnings. receive $400,
Mekhanik [1.2K]
Option 1: PV = $400,000
Option 2: Receive (FV) $432,000 in one year

PV = FV(1/(1+i)^n), where i= 8% = 0.08, n = 1 year

PV = 432,000(1/(1+0.08)^1) = $400,000

Option 3: Receive (A) $40,000 each year fro 20 years

PV= A{[1-(1+i)^-n]/i} where, n = 20 years

PV = 40,000{[1-(1+0.08)^-20]/0.08} = $392,725.90

Option 4: Receive (A) $36,000 each year from 30 years
PV = 36,000{[1-(1+0.08)^-30]/0.08} = $405,280.20

On the basis of present value computations above, option 4 is the best option for Kerry Blales. This option has the highest present value of $405,280.20

4 0
3 years ago
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