After objectives and standards are set, what step comes next in the control process?

Consider a hypothetical closed economy in which households spend $0.70 of each additional dollar they earn and save the remainin

navik [9.2K]

Answer:

(a) 0.7

(b) 3.33

(c) -$210

(d) -$147

(e) -$1 trillion

Explanation:

(a) Marginal propensity to consume (MPC) = 0.7

(b) Multiplier of this economy:

$=\frac{1}{1-MPC}$

$=\frac{1}{1-0.7}$

= 3.33

(c) Decrease government purchases by $300 billion,

Initial change in consumption = Change in government purchases × MPC

= $300 × 0.7

= -$210 billion

(d) This decreases income yet again, causing a second change in consumption equal to:

= Initial change in consumption × MPC

= -$210 × 0.7

= -$147 billion

(e) The total change in demand resulting from the initial change in government spending is:

= Change in government purchases × Multiplier

= $300 × 3.33

= -$1 trillion

7 0

3 years ago

New Products pays no dividend at the present time. Starting in Year 3, the firm will pay a $0.25 dividend per share for two year

In-s [12.5K]

Answer:

You should pay $3.86 to purchase this stock.

Explanation:

Hi, first let me mention that we can find the price of a stock by bringing to present value its future cash flows, in this case, its dividends, therefore we need to bring to present value $0.25 of year 3 and $0.25 of year 4. We also have to bring that constant dividend of $0.75 that the company plans to pay indefinitely, that we can do by using the following formula, discounted at 13%.

$PV(4)=\frac{Constant Dividend}{Discount Rate}$

Notice that the formula above says PV(4), that is because this formula only brings that perpetual annuity to one period of time before the first payment takes place, therefore this value has to be brought to present value too.

With all the considerations above, this is how everything should look like.

$Price=\frac{0.25}{(1+0.13)^{3} } +\frac{0.25}{(1+0.13)^{4} } +\frac{0.75}{0.13} *\frac{1}{(1+0.13)^{4} }$

$Price=0.17+0.15+3.54=3.86$

Therefore, the price of this stock is $3.86

Best of luck.

6 0

4 years ago

Which scenario BEST represents monopolistic competition?

ruslelena [56]

A company wins a contract to be the sole provider of phone and cable television service for a city.

4 0

3 years ago

Read 2 more answers

The following table summarizes Nowman's non-cancelable operating lease payments with remaining terms in excess of one year for t

Anna007 [38]

Answer:

$1,872,000

Explanation:

The amount of operating lease obligation that needs to be reported on the balance sheet on December 31, 2018 is the total lease payment in next following years

= $220,000 + $180,000 + $240,000 + $210,000 + $190,000 + $832,000

= $1,872,000

If you want to know the payment lease in 2024 - 2027, we do as following:

The average of prior years between 2019 to 2023

= ($220,000 + $180,000 + $240,000 + $210,000 + $190,000)/ 5 years

= $208,000

And for years after 2023, the annual lease payment should be treated as the average of prior years between 2019 to 2023, then lease payment in 2024 - 2027 is $208,000 annually. Total $832,000 in 4 years.

8 0

3 years ago

All of the following are intangible assets except

guajiro [1.7K]

The answer to this question is:

All of the following are intangible assets except??
D-"Accounts Receivable."

Hoped This helped, Awifeamother
Your Welcome :)

4 0

3 years ago

Read 2 more answers