Suppose that an initial $20 billion increase in investment spending expands GDP by $20 billion in the first round of the multipl
ier process. If GDP and consumption both rise by $10billion in the second round of the process, what is the MPC in this economy?
Instructions: Round your answer to one decimal place
MPC = $
What is the size of the multiplier?
Instructions: Round your answer to one decimal place
The multiplier = $
If, instead, GDP and consumption both rose by $12 billion in the second round, what would have been the size of the multiplier?
Instructions: Round your answer to one decimal place
The multiplier = $
Instructions: Round your answer to one decimal place
MPC = $
What is the size of the multiplier?
Instructions: Round your answer to one decimal place
The multiplier = $
If, instead, GDP and consumption both rose by $12 billion in the second round, what would have been the size of the multiplier?
Instructions: Round your answer to one decimal place
The multiplier = $
1 answer:
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Answer:
Cost volume profit analysis (CVP) refers basically to determining the break-even point of a company and how we can use that information to predict how different changes might affect it. When you are performing a CVP analysis you have to decide which variables will be constant, i.e. ceteris paribus, and which will be altered to predict the effect on the company’s operating income.
1)
sales level total revenue variable costs fixed costs total costs
2,000 48,000 36,000 24,000 60,000
4,000 96,000 72,000 24,000 96,000
6,000 144,000 108,000 24,000 132,000
8,000 192,000 144,000 24,000 168,000
2) break even point = 4,000 units
Answer:
ratio = 7 : 3
Weighted average contribution ratio = 37 %
break-even point = $800,000
sales level = $560,000
Sales level = $240,000
Explanation:
Solution
we know here that contribution margin for computer is express as
contribution margin for computer =
contribution margin for computer = 40%
and
Contribution margin for VG Systems is =
Contribution margin for VG Systems is = 30%
so
ratio = (40 + 30 ) : 30 = 7 : 3
and
Weighted average contribution margin ratio are here
Weighted average contribution ratio = 40% × 0.7 + 30% × 0.3
Weighted average contribution ratio = 37 %
and
break even point in dollars are
break-even point =
break-even point = $800,000
and
sales level are here
sales level for computer = 800000 × 70%
sales level = $560,000
and
Sales level for VG systems: 800000 × 30%
Sales level = $240,000