Answer: Experiencing declining production capacity because net investment is negative
Explanation:
Investment in a country includes capital Expenditure such as buildings, roads, inventory and etcetera which contribute to the production capacity of the Nation.
Net Investment is calculated by subtracting Depreciation from the Gross Private Domestic Investment. When Net Investment is negative, it means that the Production capacity of the nation is weakened and declining because the Investment available is not able to produce as much.
In the country described, the Net Investment is,
= Gross Private Domestic Investment - Consumption of Fixed Capital (Depreciation)
= 46 - 52
= -$6 billion
The Net Investment for this Economy is negative showing a declining production capacity.
Answer:
Knowing the slope of activities allows project managers to compare which <u>Critical</u> activities to shorten
Answer:
Holding additional capital will help avoid failure in the future by reducing solvency risk. During the 2007-2009 crisis, the market value of many assets held by banks was downgraded to garbage and became practically worthless. At the point the government had to intervene (with TARP) to save banks from collapsing.
Instead of cash, banks had huge reserves of financial assets that were worthless, which meant that they had very little to pay their clients when they would try get their money out. The only way to reduce the solvency risk (bank not being able to meet cash obligations) is to hold more cash and increase capital.
Answer:
Unseen costs might affect government or private companies/ people because these costs are difficult to identify and might be under your budget.
Explanation:
Unseen costs may affect your business company or even governments because they hidden. Seen costs are the ones you take into account in your badger and you are able to plan, include and easily detect. One example of an unseen cost can be the maintenance of an specific equipment or device which you were not expecting. There is complicated to foresee these costs so you can add an extra percentage to your original budget.
