All categories

3 years ago

Suppose that real GDP equals $10 trillion, nominal GDP equals $20 trillion, and the aggregate price level equals 2.

Business

1 answer:

Archy [21]3 years ago

4 0

Answer:

b) $10 trillion

Explanation:

Price level = NGDP / RGDP = 2

NGDP / RGDP = 2

As per the quantity theory of money,

MV = PQ

M.(2) = 20

M = 10 trillion

Therefore, The money supply is $10 trillion.

You might be interested in

On January 1, 2017, MM Co. borrows $350,000 cash from a bank and in return signs an 4% installment note for five annual payments

frez [133]

Answer:

a. Journal entry to record the issue of notes

Date Account Title & Explanation Debit $ Credit $

Jan 1 Cash 350,000

Notes Payable 350,000

(To record the issue of notes payable)

b. Calculation of Interest Expenses

Particulars Amount $

Beginning balance of loan payment 350,000

Annual interest rate 4%

Interest expenses 14,000

Hence the interest expenses = $14,000

Principal amount is calculated as the difference between the annual payment and the interest expenses as seen below

Particulars Amount $

Annual payment 96,590

Less: Interest expenses 14,000

Principal Payment 82,590

Hence, the principal payment =$82,590

6 0

4 years ago

Fyodor, a manager of the research and development team of an organization, challenges his subordinates to "think outside the box

nexus9112 [7]

Answer: mental models.

Explanation: A mental model is an explanation of someone's thought process about how something works in the real world and learning a new mental model gives you a new way to see the world. Furthermore, It’s represent the surrounding world, the relationships between its several parts and an individual intuitive perception about his or her own acts and their consequences.

4 0

3 years ago

Is simping okay? i need womans advice

Katen [24]

Answer:

Yes, as long as u know the limits :D.

Explanation:

3 0

3 years ago

Read 2 more answers

Welfare analysis: Basic concepts Identify whether each of the following statements best illustrates the concept of consumer surp

lianna [129]

Answer:

I sold a used laptop for $139, even though I was willing to go as low as $130 in order to sell it - producer surplus PRODUCER SURPLUS

Even though I was willing to pay up to $147 for a watch and even though the seller was willing to go as low as $137 in order to sell it, we couldn't reach a deal because the government imposed a tax of $16 on the sale of watches. - neither NEITHER

Even though I was willing to pay up to $47 for a jersey sweater, I bought a jersey sweater for only $39. - CONSUMER SURPLUS

Explanation:

Producer surplus is the difference between the price of a good and the least amount the seller is willing to sell the product.

In this question, the producer surplus is $139 - $130 = $9

Consumer surplus is the difference between the willingness to pay of a consumer and the price of the product.

In this question, the consumer surplus is $47 - $39 = $8

I hope my answer helps you

3 0

3 years ago

Consider relative purchasing power parity (PPP) and remember the consumer price index (CPI) provides the price level in a countr

pychu [463]

Answer:

0.7156 USD/CAD

Explanation:

Relationship between relative PPP and inflation rates can be expressed as given below:

S(1)/S(0) = (1+I(y)) / (1+I(x))................(1)

==> S(0) = spot exchange rate at the beginning of the time period

==> S(1) = spot exchange rate at the end of the time period

==> I(y) = expected inflation rate for country y, which is foreign country

==> I(x) = expected inflation rate for country x, which is domestic country.

Here, assumes that the US is a foreign country and Canada is domestic country

I(y) = (200/165) - 1 = 21.21%

I(x) = (220/170) - 1 = 29.41%

On putting the values of I(x) and I(y) in the first equation, we get:

S(1)/0.764 = (1+0.2121) / (1+0.2941)

S(1)/0.764 = 0.9366354996

S(1) = 0.764*0.936635

S(1) = 0.7156 USD/CAD

If relative PPP holds, the spot exchange rate in 2015 will be 0.7156 USD/CAD

4 0

3 years ago