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3 years ago

Suppose nominal GDP increased in a given year. Based on this information, we know with certainty that:

Business

1 answer:

Vinvika [58]3 years ago

7 0

Answer:

D. either real output or the price level (GDP deflator) have increased.

Explanation:

GDP is the total value (price x quantity) of goods & services produced by an economy during an a time period.

Real GDP is calculated on the basis of base year price index. Nominal GDP is calculated on the basis of current year price index.

So: Real GDP increases only due to rise in output quantity, not by price. Nominal GDP can increase due to rise in both output quantity or in price level (reflected in deflator).

This makes Real GDP a better measure of Economic growth than Nominal GDP, since it captures effect of increased production only (& not price).

Deflator is a measure of average price level change =

<u>Nominal GDP</u> X 100

Real GDP

Deflator > 100 shows inflation in general price level, Deflator < 100 shows deflation in general price level.

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Choose a product or service you would like to analyze. For small companies, you may not be able to distinguish the product from

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Fixed rate products problem

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3 years ago

A study finds that the noise from rock concerts is harmful; hence, the government imposes a $25 tax on the sale of every rock co

IRINA_888 [86]

Answer:

dad

Explanation:

6 0

3 years ago

Computing investing cash flows

mel-nik [20]

Answer: Please refer to Explanation

Explanation:

The Cash Flow Statement was created to ensure that businesses would know just how much hard cash they actually have. This Statement is therefore different from others in that in only records cash when it has been received and/or disbursed thus making it easier for a company to know how much cash it has.

The Investing Section of the Cashflow statement deals with fixed assets as well as transactions involving securities and bonds of other entities as those are investments.

When cash is spent on these transactions it is a Cash Outflow and is therefore subtracted.

When cash is received from such transactions it is considered a cash inflow and is added.

Effects of Above Transactions.

Sold a Truck for $11,200. This will INCREASE the Investing Cash Flow by $11,200.

Sold a Machine for $8,200. This will INCREASE the Investing Cash Flow by $8,200.

Purchased stock investments for $17,600 cash. This will DECREASE the Investing Cash Flow by -$17,600 as it was a cash Outflow.

The Investing Section of the Cash Flow Statement will look like,

Sold a Truck $11,200

Sold a Machine $8,200

Purchased stock investments -$17,600

Net Cashflow from Investing Activities $1,800

7 0

3 years ago

Jasmine Manufacturing wishes to maintain a sustainable growth rate of 8.25 percent a year, a debt-equity ratio of .44, and a div

Mars2501 [29]

Answer:

Profit Margin = 10.8%

Explanation:

We know, Sustainable Growth Rate = Retention Ratio × Return on Equity

Again, we know,

Retention ratio = (1 - Dividend payout ratio)

Given,

Dividend payout ratio = 30.5%

Sustainable growth rate = 8.25%

Debt-to-Equity ratio = 0.44

Total assets to sales = (Total Assets ÷ Sales) = 1.31

Putting the value in the above formula,

Sustainable Growth Rate = (1 - Dividend payout ratio) × Return on Equity

or, 0.0825 = (1 - 0.305) × Return on Equity

or, 0.0825 = 0.695 × Return on Equity

or, 0.1187 = Return on Equity

Therefore, ROE = 11.87%

Again, ROE in DuPont Formula = Profit Margin × Total Asset Turnover × Equity Multiplier

We know, Equity Multiplier = $\frac{Total assets}{Total shareholders' Equity}$

or, Equity Multiplier = $\frac{Total Stockholders' Equity + Total debt}{Total stockholders' Equity}$

or, Equity Multiplier = 1 + Debt to asset ratio

Again, asset turnover = (1 ÷ Total assets to sales) = 1 ÷ 1.31

Putting the value in the ROE formula,

11.87% = Profit Margin × (1 ÷ 1.31) × (1 + 0.44)

or, 0.1187 = Profit Margin × 0.7634 × 1.44

or, 0.1187 = Profit Margin × 1.099296

or, Profit Margin = 0.108

Therefore, Profit Margin = 10.8%

8 0

3 years ago

The CEO or Trad Marketing Inc. was told by an intern... "Today, advertising messages do not come from many sources, simultaneous

Elena-2011 [213]

Answer:

False

Explanation:

In the current scenario, advertising messages come from a lot of sources, they are not limited to one source.

The sources are based on the two categories, one sided communication and two sided communication.

Although the two sided communication is better and effective towards knowing and connecting to customers, but the reach of one sided communication is much wider, and then provides the knowledge of product to various customers.

In all the manners depending upon the situation and stage of performance, both communication strategies are beneficial and effective.

Therefore, above statement is false.

3 0

3 years ago