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3 years ago

The sticky-price theory helps explain what feature of the aggregate demand and aggregate supply model?

Business

1 answer:

zhuklara [117]3 years ago

7 0

Answer:

The stick price theory helps to explain the upward sloping shape of the aggregate supply curve.

Explanation:

The price tends to be sticky for a number of reasons.

Firms will need to incur menu costs if they constantly change prices
Frequent change in prices may annoy the customers
The wage rates remain the same even after change in price because the wages are based on contracts

The short-run aggregate supply curve is upward sloping because of the stickiness of price, there is a positive and direct relationship between output and price. Due to the high expected price level in the short run, the firms will expect the input prices to rise along with an increase in the product price.

To counter the increase in inputs price, the product price is kept high. The higher price provides motivation to produce more. That's why the short-run aggregate supply curve is upward sloping.

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3 years ago

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dimaraw [331]

A product-process matrix can be used to address the fact that customers often participate in service processes.

This is FALSE.

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1 year ago

The postponement of a project until conditions are more favorable: I. is a valuable option. II. is referred to as the option to

Bezzdna [24]

Answer:

The postponement of a project until conditions are more favorable:

III. could cause a negative net present value project to become a positive net present value project.

Explanation:

With the favorable project conditions, the negative NPV will be revised to a positive NPV because the positive conditions will ensure the generation of positive cash inflows. The result is that the project will be assessed as acceptable since the net present value will become positive. Generally, favorable project conditions create outcomes that are positive for the cash flows, thereby generating more positive cash inflows and reducing the impact of cash outflows.

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3 years ago

Kenzi Kayaking, a manufacturer of kayaks, began operations this year. During this first year, the company produced 1,075 kayaks

Colt1911 [192]

Answer:

Net income under absorption costing is $240,000

Explanation:

Sales (825*$1075) $886,875

less variable costs

Variable production cost($375*825) (309,375)

selling and admin. expense ($95,000)

Contribution margin $482,500

less fixed costs:

fixed production cost ($107,500)

selling and admin. expense ($135,000)

Net income $240,000

Net income under absorption was $25,000 more than the net income under the absorption costing, the difference is analyzed below:

Fixed product costs (1075-825)*$100=$25,000

That is the fixed production costs added to closing inventory under absorption method which was expensed under variable costing method

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3 years ago

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klemol [59]

Answer:

D is the answer

Explanation:

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3 years ago