Answer:
The intrinsic value = $469.15
Explanation:
<em>The price earning (P/E) ratio can be used to determine the price of a stock. This is done as follows:</em>
Price = EPS × P/E ratio
It is appropriate to use the industry average price-earning ratio for the purpose of this valuation.
The intrinsic value = 19.75 × $5.50 = $469.15
Answer and Explanation:
According to the scenario, computation of the given data are as follow:-
1) Marginal propensity to consume (MPC) for this economy is 0.75 as it denotes the spending of the household and saving of 0.25 and the spending multiplier for this economy is
= Spending Multiplier(M)
= 1 ÷ 1 - MPC
= 1 ÷ 1-0.75
= 1 ÷ 0.25
= 4
2). Decrease in government purchases will lead to a decrease in income, generating an initial change in consumption
= -Amount of Government Decrease Purchases by × MPC
= -$250 billion × 0.75
= -$187.5 billion
3). Decrease income again, causing a second change in consumption
= Amount Decrease in Government Purchases × MPC
= -$187.5 billion × 0.75
= $140.6 billion
4).Total change in demand resulting from the initial change in government spending
= Amount of Government Decrease Purchases by × Spending Multiplier(M)
= $250 × 4
= $1,000 billion
= $1 trillion
As we can see that the income falls by $1000 billion in the end, so AD shifts to the left by the size of $1 trillion
In the question the graph is missing. Kindly find the attachment for both of question and answer
Its correct because tge more cheeper it is the more will eat and she will make goid money and the higher price will take her shop in loss
Existing business with a proven record. When you ask for investments, the lending institution will most definitely ask for your financial track record. They would want to know if you are a good paymaster because they will need the assurance that you can pay them back. Even if you have a really original idea and want to start a new business, there will still be some reservation if you have no track record because the lenders do not know if you are trustworthy or not. Unlike if you already have a proven record that you are a good paymaster, then you at least have proof that you can pay back.