Answer: Please refer to Explanation
Explanation:
1. Inflationary Gap.
Due to the availability of more disposal income due to tax cuts, more amount is being spent on consumption leading to a rise in actual GDP which is more than the potential GDP as the economy has not adjusted.
2. Output Gap.
This is the difference between the Actual GDP and the Potential GDP.
3. Demand Shock
This increases or reduces Aggregate Demand due but only temporarily.
4. Recessionary Gap.
This is where actual GDP falls below Potential GDP.
5. Supply Shock.
Like a demand shock, it suddenly increases or reduces the supply of goods and services. It is temporary as well.
6. Self Correction
Economists believe that in the long run, the Economy is capable of adjusting to shocks and returning to it's potential and natural levels.
The correct answer is : B. Microcredit Loans
Microcredit loans are usually a very small loans to impoverished who usually does not have enough collateral or steady source of income/ Since the west and central Africans live way below poverty border, Microcredits is one of the best way to improve their economy.
So in this case, you would need to find the present value (PV) of the monthly payments. With the information given, you would have a PV= 195,413.08, which is less than the lump sum payment. In this case, you would take the 1 time payment.
Another way to look at this is to calculate the future value (FV) of both payouts. For the lump sum payment, you would assume the same interest rate (6%) and at the end of the same 20 years period, your investment would be worth 662,040.90 while the monthly payment option would be worth 646,857.25
Answer:
year net cash flow
0 -$150,000
1 $80,000
2 $65,000
3 $50,000
4 $40,000
A) NPV = -$150,000 + ($80,000 x .87) + ($65,000 x .756) + ($50,000 x .658) + ($40,000 x .572) = -$150,000 + $69,600 + $49,140 + $32,900 + $22,880 = -$150,000 + $174,520 = $24,520
B) Yes , because the net present value indicates that the return on the proposal is greater than the minimum desired rate of return of 15%. Since the NPV is positive ($24,520), it means that the cash inflows are higher than the cash outflows when we use a 15% discount rate.
Answer:
Loss
Explanation:
Because she started with 860.00 then ended with 300
