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Alex17521 [72]
3 years ago
6

The new classical critique of activist fiscal policy is theoretically different from the crowding-out critique. Crowding-out occ

urs when private spending __________ in response to government spending. Under the new classical critique, increased government spending leads people to __________ their current savings in order to help pay for higher taxes in the future.
A. decreases; decrease
B. increases; increase
C. decreases; increase
D. increases; decrease
Business
1 answer:
Alik [6]3 years ago
6 0

Answer:

C. decreases; increase

Explanation:

Although both the crowding-out critique and the classical critique both argue that more public spending (activist fiscal policy) will lead to less private spending (thus less-than-expected increase in demand for the economy to grow), the reasons they put forward are subtly different.

Crowding-out happens because government spending reduces the money supply (hence raise interest rate - the price of money) or investment opportunities to the private sector, making it <em>difficult for the private sector to spend</em> , hence there's less private spending.

The classical critique argues that because people anticipate that goverment will increase tax in the future to cover for the fiscal deficit, <em>they will save more to pay for tax</em>, also leading to less private spending.

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A monopoly market is characterized by the inverse demand curve P = 1,200 – 40 Q and a constant marginal cost of $200. If the mar
Sergeeva-Olga [200]

Answer:

The profit maximizing output level declines by 2.5 units and the price rises by $100.

Explanation:

In a monopoly market the inverse demand curve is given as,

P = 1,200 - 40Q

The marginal cost of production of the last unit is $200.

The total revenue is

= Price\times Quantity

= 1,200Q - 40Q^{2}

The marginal revenue of the last unit is

= \frac{d}{dx} TR

= 1,200 - 80Q

At equilibrium the marginal revenue is equal to marginal price,

MR = MC

1,200 - 80Q = 200

80Q = 1,000

Q = 12.5

Putting the value of Q in the inverse demand function,

P = 1,200 - 40\times 12.5

P = $700

Now, if the marginal cost rises to $400,

At equilibrium the marginal revenue is equal to marginal price,

MR = MC

1,200 - 80Q = 400

80Q = 800

Q = 10

Putting the value of Q in the inverse demand function,

P = 1,200 - 40\times 10

P = $800

4 0
3 years ago
How do you delete awnsers that people post
Natali [406]

You have to be a moderator. That's all I know.

5 0
3 years ago
Read 2 more answers
Managers make assumptions in CVP analysis. These assumptions include: (Check all that apply.) Multiple select question. some uni
BigorU [14]

The assumptions that are made in CVP analysis includes the following:

  • costs can be classified as variable or fixed.
  • costs are linear within the relevant range.
  • constant fixed cost per unit.

<h3>What is CVP analysis?</h3>

Cost Volume Profit analysis is the type of analysis that has to do with the cost accounting. This type of analysis is one that takes the impact of the various costs and volume on profit.

It helps to check how the changes that occur in the variable and the fixed cost affect profit.

Read more on CVP analysis here:

brainly.com/question/26654564

#SPJ1

4 0
2 years ago
Vaughn Manufacturing's allowance for uncollectible accounts was $190000 at the end of 2020 and $178000 at the end of 2019. For t
Colt1911 [192]

Answer: $19000

Explanation:

From the question, we are informed that Vaughn Manufacturing's allowance for uncollectible accounts was $190000 at the end of 2020 and $178000 at the end of 2019 and that for the year ended December 31, 2020, Vaughn reported bad debt expense of $31000 in its income statement.

The amount that Vaughn debited to the appropriate account in 2020 to write off actual bad debts will be:

= $31000 - ($190000 - $178000)

= $31000 - $12000

= $19000

8 0
3 years ago
Just before colliding with another vehicle, you should __________.
S_A_V [24]
Just before colliding with another vehicle, you should t<span>ake your foot off the brake pedal.
</span><span> There are several things you can do in order to minimize the consequences of collisions. One of them is to take your foot off the brake pedal. Other are:
- If possible, swerve to the right side of the road when you take evasive action.
</span><span>- Another general rule is to hit an object with a glancing blow (at an angle) rather than head-on.</span>
4 0
3 years ago
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