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Oliga [24]
3 years ago
14

If firms reduce investment spending and the economy enters a recession, which of these contributes to the adjustment that causes

the economy to return to its long-run equilibrium?
Business
1 answer:
Leya [2.2K]3 years ago
6 0

Answer:

If workers agree to accept lower wages

Explanation:

Recession is a business situation in which economic activities are at a decline as a result of reduction in spending.

When this occurs, it affects firms and their investments and as such firms have to reduce their investment to ensure that the firm stays afloat and also trying to stabilize the economy. As part of trying to stabilize the economy, workers have to agree to accept lower wages till the economy is at equilibrium again. Accepting lower wages returns the economy to long-run equilibrium.

Cheers.

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4 0
3 years ago
Courts Distributors needed two hundred compact refrigerators on a rush basis. It contacted Eastinghouse Corporation, a manufactu
Romashka [77]

Answer:

Courts Distributors and Eastinghouse Corporation

Dispute over Contract Price

The two parties have a legal contract.  The contract was established when Courts requested Eastinghouse to send the refrigerators and bill later.

The exact price for the contract is in dispute.  This dispute can be resolved between the parties.  Reference to the market price will help resolve the dispute, otherwise, the parties may seek alternative dispute resolutions, like litigation, mediation, or arbitration.

Explanation:

a) Data and Analysis:

Eastinghouse's invoice price for the refrigerators = $140,000

Courts' adopted market price = $120,000

b) Since Courts' reference to the price is with regard to the wholesale market price, it may be that Eastinghouse quoted the retail price instead.  Since Courts is a distributor, it has the right to be charged a wholesaler's price and not a retailer's.  Therefore, we can conclude that after due reference to the prevailing market price of similar refrigerators, the two parties may agree to a price of $120,000 or a little higher.

7 0
3 years ago
Blur Corp. has an expected net operating profit after taxes, EBIT(1 – T), of $7,600 million in the coming year. In addition, the
Zina [86]

Answer:

Free cash flow (FCF) for next year = $ 6,450  million

Explanation:

<em>Free cash flow represents the amount that is left to all the providers of capital after the payment of all all operating expenses, working capital and investment in fixed asset expenditures.</em>

<em>It is computed as cash flow made from operation less capital expenditures</em>

For Blur Communications

The Free cash flow

= EBIT (1-T) - increase in capital expenditure - increase in working capital

= 7600 - $1,140 - 10

= $ 6,450  million

Free cash flow (FCF) for next year = $ 6,450  million

6 0
3 years ago
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When a company rely on more debt, the value of the company will fell down at the perception of potential investors.
To determine the risk of investments, investors often compared the ratio between total assets and total debts (assets to debt ratio). Companies with low assets to debt ratio is regarded as a risky investment because it indicates that the company still has not enough capability to generate enough profit to buy its own assets
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3 years ago
if you make a one-time investment of $500 at 8% interest compounded annually, how much money will you have in 20 years? 50 years
sladkih [1.3K]

The formula for annually compounded interest is as follows:

A = P(1 + r)^t

P is the initial amount you invest, r is the interest rate as a decimal, and t is the number of years the money will have been invested.

Convert the 8% interest rate into a decimal by dividing by 100:

8 \div 100 = 0.08

We now have all of our values. Plug the known values into the equation:

P = 500, r = 0.08

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500(1+0.08)^{20} = 500(1.08)^{20} = \boxed{2330.48}

t  = 50

500(1+0.08)^{50} = 500(1.08)^{50} = \boxed{23450.81}

8 0
3 years ago
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