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sergejj [24]
2 years ago
7

Suppose that the natural rate of unemployment in a particular year is 4 percent and the actual rate of unemployment is 7 percent

. instructions: enter your answers as whole numbers.
a. use okun's law to determine the size of the gdp gap in percentage-point terms.

b. if the potential gdp is $500 billion in that year, how much output is being forgone because of cyclical unemployment?
Business
2 answers:
uranmaximum [27]2 years ago
4 0

WHY ARE YOU ASKING ABOUT UNEMPLOYMENT? ARE YOU SELF AWARE YOU DON'T HAVE A JOB JOOOOOHN? HMPH SO SLOW FOR MAKING UNEMPLOYMENT INTO THE WIND OF RETURDED NESS

koban [17]2 years ago
4 0

Answer:

a. The GDP gap is: 6%

b. The forgone output is: $30 billion

Explanation:

GDP (gross domestic product) is the output produced within a country in a given time period. Okun's law establishes an inverse empirical relationship between unemployment and losses in productivity of a country. In terms of output, Okun's law states that for every percentage increase in cyclical unemployment, a country's potential output is lowered by 2%. Cyclical unemployment is the difference between the natural unemployment rate and the actual unemployment rate.

In this scenario, the natural rate of unemployment is 4% and the actual rate is 7%. Therefore, unemployment due to business cycle fluctuations is: 3% . Since the output gap is double the percentage increase in unemployment, the output or GDP gap is 6%. The dollar amount of the GDP gap given the $500 billion potential GDP is (0.06 * 500) = $30 billion

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3 years ago
Art Company issued 6%, 5 year bonds, with par value of $1,600,000, paying semiannual interest for $1,470,226. The annual market
Soloha48 [4]

Answer:

The correct answer is option (B).

Explanation:

According to the scenario, the given data are as follows:

Bond carrying value = $1,470,226

Rate of interest = 8%

Rate of interest (Semiannual ) = 4%

So, we can calculate the the bond interest expense on the first interest payment by using following formula:

The bond interest expense = Bond carrying value × rate of interest (semiannual)

By putting the value we get

= $1,470,226 × 4%

= $58,809

6 0
3 years ago
When one firm is able to dominate the market and no other firm is able to enter the market, a(n) ______________ has formed.
matrenka [14]
B. Monopoly is the correct answer
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3 years ago
Rapp and Wunderman are subsidiaries of large agency holding companies that provide services for companies that want to communica
Contact [7]

Answer:

The correct answer is letter "A": direct-marketing.

Explanation:

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3 0
2 years ago
Ivanhoe Company purchased a new machine on October 1, 2017, at a cost of $77,980. The company estimated that the machine has a s
Marysya12 [62]

Answer:

Depreciation for

2017 = $2,540

2018 = $10,160

Explanation:

Provided, Total cost of the machine = $77,980

Estimated salvage value = $6,860

Therefore, value to be depreciated = $77,980 - $6,860 = $71,120

Total life of asset = 7 years

Depreciation for the year 2017 = October to December = 3 months

\frac{71,120}{7} \times \frac{3}{12} = $2,540

Depreciation for the year 2018 = \frac{71,120}{7} = $10,160

Under straight line method depreciation is fixed for each year, but in the given case in 2017 the asset is used only for 3 months, thus depreciation will be charged for 3 months only.

Final Answer

Depreciation for

2017 = $2,540

2018 = $10,160

7 0
3 years ago
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