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vitfil [10]
3 years ago
6

Suppose you had a large unpaid balance on your credit card and were paying a high rate of interest. You then received a​ one-tim

e tax rebate from the government and decided to pay down the balance on your credit card. If there were many others like you in the​ economy, would the tax cut be an effective​ stimulus?
Business
1 answer:
Annette [7]3 years ago
4 0

Answer:

The answer is NO.

Explanation:

The answer is NO since the tax cut does not equate or rather would not be an effective stimulus due to the fact that debt reduction would not stimulate or increase consumption.

To properly understand the narrative of the question and the answer herein, let us define what effective stimulus is.

Effective stimulus or as preferably known as An economic stimulus is the utilization of funds or design of that helps agitate growth during downtime or recession in a country. The decision makers of a country mostly utilize the tactics of giving rebates and  increasing government expenses to name a few.

Now relating it back to the question, since the intention of the rebate is to ease payment on tax does not equate to increase in consumption, the answer is a NO.

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How would life be without technology
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3 years ago
"Liberty may be endangered by the abuse of liberty, but also by the abuse of power."—James Madison Which of the following statem
Alex73 [517]

Answer:

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5 0
2 years ago
The accounting equation is assets = liabilities + owner’s equity.
Anon25 [30]

Answer:

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It must balance because all the assets that firm controls have been acquired either by external funding (liabilities), or by internal funding (owner's equity).

This also explains the relationship between economic resources and claims to economic resources. Economic resources (assets) are either the claim of an external agent that has to be paid in the future (liability), or the claim of one of the company's owners who could in theory dissolve the company and take possession of the company's assets (equity).

B. What transactions increase or decrease owner’s equity?

Profits increase owner's equity, as well as capita contributions, whether in the form of stocks, equipment, or other financial instruments.

Costs and expenses are substracted from revenues, and therefore they reduce profits, and owner's equity.

C. How does net income or loss affect owner’s equity?

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D. Please give an example of a transaction, applied to the accounting equation.

ABC corporation issues 1,000 common stocks with par value of $5, and a price per stock of $7. The journal entry is:

Account                                    Debit                Credit

Cash                                        $7,000

Common Stock                                                 $5,000

Additional Paid-In Capital                                $2,000

In this transaction, cash is an asset and common stock and additional paid-in capital are part of the stockholder's equity. The corporation does not have any liabilities yet.

ABC Corp accounting equation = Assets = Liabilities + Stockholder's equity

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As can be seen, the accounting equation is true even in the earliest stages of the corporation.

6 0
3 years ago
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