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Finger [1]
3 years ago
12

If an economy at full employment experiences a fall in aggregate demand, then what should the government do to restore the econo

my to full employment? Select the correct answer below: Institute quantity controls in order to maintain full output. Institute price controls in order to maintain full employment. The government should engage in contractionary fiscal policy. The government should engage in expansionary fiscal policy.
Business
1 answer:
Eddi Din [679]3 years ago
6 0

Answer:

The government should engage in expansionary fiscal policy.

Explanation:

If there is a fall in the aggregate demand in an economy then this will restore by implementing the expansionary fiscal policy and the full employment level is achieved.

Expansionary fiscal policy states that a government of this nation should reduces taxes and increases its spending for inducing the aggregate demand to boost up. Lower taxes would increase the disposable income of the consumers and hence, the demand for goods and services increases.

These changes would increase the aggregate demand and shifts rightwards. This will maintain the full employment level in this economy.

You might be interested in
During a presidential campaign, the incumbent argues that he should be reelected because GDP grew by 12 percent during his 4-yea
KengaRu [80]

Answer: The real GDP per person grew by 8%. Option C is the correct option

Explanation:

To calculate the real GDP per person, we have to calculate the real GDP growth rate in respect to the growth in population and deflator rate, then multiply it with the GDP growth.

GDP deflator = Nominal GDP ÷ Real GDP

The nominal GDP which includes the addition of population will grow by 4% since the population growth was 4%

GDP deflator increase by 6%

Therefore;

Real GDP = 4% ÷ 6% = 0.66667

THE REAL GDP PER PER PERSON

12% × 0.66667 = 8.00004%

Therefore the the real GDP per person is 8%, which is less than what he said.

8 0
3 years ago
D’Lite Dry Cleaners is owned and operated by Joel Palk. A building and equipment are currently being rented, pending expansion t
lisov135 [29]

Answer:

1) equity = assets - liabilities

equity = $45,000 + $93,000 + $7,000 + $75,000 - $40,000 = $180,000

2) Since there is not enough room here, I used an excel spreadsheet to prepare the accounting equation.

     

3) D’Lite Dry Cleaners

Income Statement

For the month ended July 31, 202x

Revenues                                                       $116,875

Expenses:

  • Dry cleaning expense $29,500
  • Rent expense $6,000
  • Wages expense $7,500
  • Truck expense $2,500
  • Supplies expense $3,600
  • Utilities expense $1,300
  • Miscellaneous expense $2,700           ($53,100)

Net income                                                      $63,775

D’Lite Dry Cleaners

Balance Sheet

For the month ended July 31, 202x

Assets:

Cash $95,325

Accounts receivable $89,750

Supplies $5,900

Land $125,000

Total assets $315,975

Liabilities:

Accounts payable $49,200

Equity:

Capital $266,775    

Total liabilities and equity $315,975

D’Lite Dry Cleaners

Statement of Owner’s Equity

For the month ended July 31, 202x

Palk, Joel, capital, beginning balance    $180,000

Additional capital raised                           $35,000

<u>net income                                                  $63,775</u>

subtotal                                                     $278,775

<u>drawings                                                   ($12,000)</u>

Palk, Joel, capital, ending balance        $266,775

Download pdf
3 0
3 years ago
The inflation rate in Great Britain is expected to be 4% per year, and the inflation rate in Switzerland France is expected to b
VladimirAG [237]

Answer:

The spot rate in two years time = SF 12.99

Explanation:

The purchasing power parity states that the relationship between the current and future spot rate between two currencies can be linked to the differences in the expected inflation rate between the currency.

This relationship can be expressed as follows:

S1=  So× (1 + hc)/(1 + hb)

So= Current spot rate, Hc- inflation rate in Switzerland, Inflation rate in Britain

Spot rate in a year's time

S1= 12.50, Hc=6%, Hc=4%

S1= 12.50× (1.06/1.04)

S1=12.74

Spot rate in two year's time

S1= 12.74× (1.06/1.04)

S1= 12.99

The spot rate in two years time = SF 12.99

5 0
3 years ago
Suppose that the MPC is 0.8 and that $18 trillion of real GDP is currently being demanded. The government wants to increase real
Bingel [31]

Answer: $200 billion

Explanation:

First find the government spending multiplier:

Multiplier = 1 / (1 - MPC)

= 1 / (1 - 0.8)

= 5

The government wants to increase the real GDP to $19 trillion from $18 trillion which means that they want to increase it by $1 trillion.

In order to increase it by $1 trillion, the amount the government needs to spend is:

Increase in real GDP = Multiplier * Government spending

1 trillion = 5 * Government spending

Government spending = 1 trillion / 5

= $200 billion

4 0
2 years ago
Marquis Company uses a weighted-average perpetual inventory system and has the following purchases and sales:August 210 units we
a_sh-v [17]

Answer:

cost of ending inventory = $158.40

so correct option is A. $158.40

Explanation:

given data

August 2 =   10 units were purchased at $12 per unit

August 18 = 15 units were purchased at $14 per unit

August 29 = 12 units were sold

to find out

amount of the cost of goods sold

solution

we get here total purchase that is express as

total purchase = 10 × 12 + 15 × 14

total purchase = $330

total units purchase is = 10 +15 = 25

so weighted average cost will be

weighted average cost = \frac{330}{25}

weighted average cost = $13.2

cost of ending inventory = $13.2 × 12 units sold

cost of ending inventory = $158.40

so correct option is A. $158.40

4 0
3 years ago
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