Answer:
a cost would be what you pay minus what you earn.
Explanation:
Answer:
a.
Relevant costs:
Supplies costs
Inspection costs
Assembly costs
Irrelevant cost:
power cost
b.$20,000
Explanation:
The following costs are relevant because they would be incurred as a result of investing in either of the two alternatives:
Supplies costs
Inspection costs
Assembly costs
Power costs is not relevant because is not incurred as direct consequence of the two alternatives,even when none of the alternatives is chosen power cost would still be incurred.
Costs of alternative M=$77,000+$49,000+$42,000+$168000
Costs of alternative N=$68,000+$49,000+$31,000=$148,000
Differential cost=$168,000-$148,000=$20,000
Answer:
A. $200
B. Fall
C. Inflationary expenditure gap and employment levels are higher than the full employment level.
Explanation:
A. Equilibrium occurs where real output (Y) equals aggregate expenditures (AE), where AE = C + Ig+ G +Xn.
Therefore the equilibrium value is:
Y = AE = C + Ig+ G +Xn
= $120 + $60 +(-$10) +$30 = $200
B. If real GDP is $230 and the aggregate expenditures of $200 will result in positive unplanned inventory investment which means GDP will fall as firms respond to the inventory build-up by reducing output.
C. C + Ig+ G +Xn
$170 + $60 + (−$10) +$30 =$250
Therefore since full-employment and full-capacity output in the economy is $230 there is an inflationary expenditure gap and employment levels are higher than the full employment level.
