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Alex_Xolod [135]
3 years ago
8

In the short run, the quantity of output that firms supply can deviate from the natural level of output if the actual price leve

l in the economy deviates from the expected price level. Several theories explain how this might happen.
For example, the sticky-wage theory asserts that output prices adjust more quickly to changes in the price level than wages do, in part because of long-term wage contracts. Suppose a firm signs a contract agreeing to pay its workers $15 per hour for the next year, based on an expected price level of 100. If the actual price level turns out to be 110, the firm's output prices will___________ , and the wages the firm pays its workers will remain fixed at the contracted level. The firm will respond to the unexpected increase in the price level by_________ the quantity of output it supplies. If many firms face similarly rigid wage contracts, the unexpected increase in the price level causes the quantity of output supplied to ___________ above the natural level of output in the short run.
Business
1 answer:
timofeeve [1]3 years ago
5 0

Answer:

1.  Rise

2.  Increasing

3.  Rise

Explanation:

For example, the sticky-wage theory asserts that output prices adjust more quickly to changes in the price level than wages do, in part because of long-term wage contracts. Suppose a firm signs a contract agreeing to pay its workers $15 per hour for the next year, based on an expected price level of 100. If the actual price level turns out to be 110, the firm's output prices will RISE, and the wages the firm pays its workers will remain fixed at the contracted level. The firm will respond to the unexpected increase in the price level by INCREASING the quantity of output it supplies. If many firms face similarly rigid wage contracts, the unexpected increase in the price level causes the quantity of output supplied to RISE above the natural level of output in the short run.

The above explanation is the reason why the aggregate supply curve slopes upward in the short run

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Coyne Corporation is evaluating a capital investment opportunity. This project would require an initial investment of $30,000 to
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Answer:

A. $41,120.

Explanation:

Year    Description          Cash flow           Present [email protected]%

0       Equipment cost      ($30,000)                    ($30,000)

1-4      Additional CF           $24,000                    $69,929.10

4        Residual value            $2,000                       $1,184.16

Present value total                                                 $41,113.26

Based on the above calculation, the answer shall be A. $41,120.

8 0
3 years ago
The Fabricating Department started the current month with a beginning Work in Process inventory of $11,200. During the month, it
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Answer:

The ending balance of the Work in Process Inventory account for the Fabricating Department is: $11,200

Explanation:

To determine Ending Balance of Work in Process Inventory, <em>Prepare a Manufacturing Cost Statement</em>.

Opening Work in Process Inventory             $11,200

<em>Add </em>Cost Added During the Period :

Direct materials                                             $77,200

Direct labor                                                   $25,200  

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Total Manufacturing Costs                          $126,200

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Closing Work in Process Inventory               $11,200

Conclusion :

Therefore, the ending balance of the Work in Process Inventory account for the Fabricating Department is: $11,200

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3 years ago
Jane and Brad both produce nuts and coffee. They each prefer to consume a diet that is half nuts and half coffee. Both have acce
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D. Bras has an absolute advantage in coffee and jane has an absolute advantage in nuts
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3 years ago
Jason, an African-American, and Robert, a Caucasian, both experienced welders, apply for two openings at Virgo Inc. Robert is hi
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e. Virgo deals in building equipment that requires a certified welder and Jason is not a certified welder.

Explanation:

8 0
3 years ago
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If the company wishes to increase its total dollar contribution margin by 30% in 2020, by how much will it need to increase its
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Answer:

$35,400

Explanation:

The computation of the increase in sales is shown below:

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Therefore, the increase in sales is

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= $35,400

7 0
3 years ago
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