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Pachacha [2.7K]
3 years ago
5

Suppose that disposable income is $1,000, consumption is $700, and the marginal propensity to consume (MPC) is 0.6. If disposabl

e income then increases by $100, consumption and savings will equal which of the following
Business
1 answer:
Tom [10]3 years ago
5 0

Answer:

E. Consumption = $ 760

Savings = $ 340

Explanation:

Given that,

Disposable Income = 1000

Consumption = 700

MPC = 0.6

Change in disposable income= 100

Recall that

MPC = Change in consumption ÷ change in disposable income.

Therefore

change in consumption = MPC × Change in disposable income.

Thus

Change in C = 0.6 × 100

= 60

Therefore

CONSUMPTION = 700 + 60

= $ 760

Again, recall that

I = C + S

Where I = Income and S = Savings

Therefore

S = I - C

I = 1000 + 100 = 1100

C = 760

S = 1100 - 760

SAVINGS = $ 340

C = $760

S = $340

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Answer:$27.78

Explanation:

Expected value of debt after one year = (40* .60)+(15*.40)

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=$ 30

Current value of debt = Value at 1year / (1+r)^n

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3 0
3 years ago
A primary market would be utilized when:
babymother [125]

Answer:  Option C

Explanation: Primary market refers to the market in which the securities are sold to the general public for the first time by the companies. In simple words, the initial public offering process takes place in such markets. The securities could be of any type whether debt, equity or preference.

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Hence the correct option is C.

7 0
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A project manager is preparing two documents for risk management. One contains sources of overall project risk and also summary
vagabundo [1.1K]

Answer: Risk Report

Explanation:

A Risk Report for a project contains all the risk that the project is exposed to. This includes both project risk as well as individual risks related to the components projects in the overall project.

A Risk Report details the risks such as Supplier failure, Inflation, Pending Government Regulations and the like. It then takes these and summarizes them for presentation to those who require this information in the company so that appropriate safeguards may be set up and precautions taken.

This describes the first document and so should be what the Project Manager names it.

8 0
2 years ago
Current ratio of 3.4 and an acid-test ratio of 2.8. The corporation's current assets consist of cash, marketable securities, acc
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Answer:

$30,000

Explanation:

The computation is shown below:

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Current assets = 3.4 × Current liabilities

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2.8 = Currents assets - inventory  ÷ Current liabilities

2.8 = 3.4 × Current liabilities - $18,000 ÷ Current liabilities

2.8 × Current liabilities = 3.4 × Current liabilities - $18,000

After solving this, the current liabilities is $30,000

7 0
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