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2 years ago

The price of imported oil rises. If the government wanted to stabilize output, which of the following could it do?

Business

2 answers:

tankabanditka [31]2 years ago

8 0

Answer:

The correct answer is letter "A": increase government expenditures or increase the money supply.

Explanation:

Fiscal policy refers to the joint governmental decisions concerning taxation and spending of a nation. The term was coined by the British economist John Maynard Keynes (<em>1883-1946</em>) who claimed that governments could control rates of macroeconomic growth by raising the rate of employment, battling inflation and flattening business cycles.

Whether increasing government expenses or money supply, the overall economy will be balanced as long as the prices are going up as well.

Ber [7]2 years ago

6 0

Answer:

b. increase government expenditures or decrease the money supply

<em>Explanation:</em>

<em>If the government wanted to stabilize output, there are a couple of levers they could pull. These are fiscal policies and monetary policies, fiscal policy, is all about changing how much we spend, if government has more money to spend, they can better negotiate and also decide how money is spent to a degree. So, the theory is if the government spends more, that would increase total output. The second lever to pull is messing with the money supply, monetary policy, If maybe there's more money out there, lower interest rates, it might increase output however because we are dealing with the price of imported oil decreasing the money supply would be the move to make because by decreasing the money supply we can make our currency more valuable, it's important to remember that the price of imported oil would not be affected by domestic monetary policies. If the money supply were increased our currency would devalue which would be counterproductive because a weaker currency means we pay more for imports. </em>

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Answer:

e. Business analysis

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2 years ago

Assume that a currency's spot and future prices are the same, and the currency's interest rate is higher than the U.S. rate. The

Andrei [34K]

Answer:

put upward pressure on; put downward pressure on

The actions of U.S. investors to lock in this higher foreign return would PUT UPWARD PRESSURE ON the currency's spot rate and PUT DOWNWARD PRESSURE ON the currency's futures price.

Explanation:

If both the spot and the forward price of a currency are the same, it means that it should be worth the same today than in the future. If you can earn higher interest by investing in that foreign currency, then investors will start purchasing higher amounts of the foreign in order to invest and gain higher rates.

Since the demand for the foreign currency increases, that put upward pressure its current price. Simply more investors will want to invest in that currency. While that happens right now, the market will tend to adjust to correct this arbitrage, and the way this can be adjusted is by lowering the future price of the currency. That puts downward pressure on the forward rate.

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2 years ago

In most markets, _____ is determined by the interactions of numerous buyers and sellers.

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1 year ago

Select all that apply On December 1, Christy Co. accepted a 60-day, 6%, $1,000 note due January 30. On December 31, the appropri

kykrilka [37]

Answer:

Notes Receivable for $1,000. Cash for $1,010. Interest Revenue for $5. Interest Receivable for $5.

Explanation:

The journal entry to record the receipt of the payment is shown below:

Cash Dr $1,010

To Interest receivable $5 ($1,000 ×6% × 30 days ÷ 360 days)

To Interest revenue $5

To Note receivable $1,000

(being the receipts is recorded)

here cash is debited as it increased the assets and credited the interest receivable, interest revenue and note receivable as it increased the assets and revenue accounts

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2 years ago