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soldier1979 [14.2K]
3 years ago
15

Suppose foreigners find U.S. goods and services more desirable for some reason other than a change in the exchange rate. Which p

olicies could be used to offset the resulting change in output? a. a decrease in the money supply and a decrease in government purchases. b. a decrease in the money supply and an increase in government purchases. c. an increase in the money supply and a decrease in government purchases. d. an increase in the money supply and an increase in government purchases.
Business
2 answers:
Mashcka [7]3 years ago
8 0

Answer:

The correct answer is option a.

Explanation:

If foreigners find US  goods and services more desirable, they will demand more of these goods and services. The price level will increase. The domestic firms will start producing more to earn higher revenue and profits. The output level will increase.

To offset this increase in output the government will decrease money supply in the economy. To do so the government can adopt several measures. Government can adopt contractionary monetary or fiscal policy. Government can reduce money supply by reducing purchases.

alekssr [168]3 years ago
5 0

Answer: Option (a) is correct.

Explanation:

Correct Option:  A decrease in the money supply and a decrease in government purchases.

If US goods and services are more desirable for foreigners then the exports of united states increases. Therefore, the earnings from the exports increases and hence, there will be more money in the market which increases the money supply in an economy.

So, the fed uses the Contractionary monetary policy and fiscal policy to offset the resulting change in output.

∴ Contractionary monetary policy will results in decrease in the money supply and Contractionary fiscal policy will results in decrease in government purchases.

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Radverb Inc. paid a dividend of $2.00 last year. The company expects to increase the dividend at a constant rate of 2% per year,
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<u>Solution and Explanation:</u>

The given ke  = 0.08 , Ke = 8%

Now, the required return falls by half (by 50%)

Ke (revised) = 8 percent multiply with the 50 percent = 4%

The Price of Radvob’s stock = 2(1.02) / 0.04-0.02 =$102

Do= $2

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The given Current price = $34

Ke= required return = ?

The Current price = \mathrm{D}_{0}(1+\mathrm{G}) / \mathrm{K}_{\mathrm{e}}-0.02

Ke=0.08 , Ke=8%

Now, the required return falls by half(by 5%)

Ke (revised) = 8 percent multiply with 50 percent = 4%

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4 years ago
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Korolek [52]

Answer:

$7.50

Explanation:

Earnings per share = Earning attributable to holders of Common Stock ÷ Weighted Average Number of Common Stocks Outstanding

therefore,

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thus,

The company's earnings per share on common stock is: $7.50

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3 years ago
Discouraged workers are
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Anastaziya [24]

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<h3>What is income tax?</h3>

A tax placed on people or organizations in relation to their income or profits is known as an income tax. Tax rates multiplied by taxable income are typically used to calculate income taxes. Tax rates might change depending on the taxpayer's attributes and source of income.

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2 years ago
What is the role of accounting in business
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