What happens to the equilibrium price when supply goes down? A. The price goes up. B. The price goes down. C. The price stays th
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Answer:
A - The Short Run Aggregate Supply curve shifts to the right.
Explanation:
The Short Run Aggregate Supply curve plots aggreagrate price against aggreagrate quantity.
If producers believe a recession is imminent and they reduce the amount of machinery purchased, the quantity supplied would reduce shifting the Short Run Aggregate Supply curve to the left.
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Bob has to own his land for 18 years if the price is increasing at the rate of 6% per year.
Given that land was bought by Bob for $16390, the price is increasing at the rate of 6%, price of land today is $46817.
We are required to find the time for which Bob need to own the land so that the price of the land is $46817 today.
Compounding means calculating amount on the principal and the amount added interest.
Rate of increasing the price of land be 6%.
Price when Bob bought the land=$16390.
Price of land today=$46817.
It is like compounding of interest and the sum is calculated as under:
S=P*
In the above equation P is theamount at beginning,r is rate of increasing and n is the number of years.
46817=16390
46817/16390=
=2.8564
=
(Approximately)
From both the sides we will get n=18.
Hence Bob has to own his land for 18 years if the price is increasing at the rate of 6% per year.
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