1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Nana76 [90]
3 years ago
7

2. Let’s work out a simple example where a person smooths her consumption over time. Gwen is a real estate agent, and she knows

that she will have some good years and some bad years. She figures that half the time she’ll earn $90,000 per year, and half the time she’ll earn $20,000 per year. These numbers are after taxes and after saving for retirement. These numbers are all she has to worry about. a. If we ignore interest costs just to keep things simple, how much should Gwen consume in the average year? b. How many dollars will she save during the good years? c. How many dollars will she borrow during the bad years? (Note: "Borrowing," in this context, is basically the same as "pulling money out of savings.")
Business
1 answer:
Pepsi [2]3 years ago
8 0

Answer:

A) How much should Gwen consume in the average year?

Gwen should consume the average money she earns taking into account the good and bad years.

In the good years, she is earning $90,000, and in the bad years she is earning $20,000. We simply obtain the average:

$90,000 + $20,000 = $110,000/2 = $55,000

B) How many dollars will she save during the good years?

Personal saving equals disposable income minus consumption. As stated above, during the good years she will consume $55,000, while having a disposable income of $90,000. Her personal saving will then be:

$90,000 - $55,000 = $35,000

C) How many dollars will she borrow during the bad years?

During the bad years, Gwen is making $20,000, while consuming an average of $55,000 per year. Therefore, her total borrowing during the bad yeras is:

$55,000 - $20,000 = $35,000

In other words, for every bad year, she will exhaust a total good year's savings.

You might be interested in
Self-interest helps achieve society's economic goals because as consumers and producers exercise their ____ to act in their own
aleksklad [387]

Answer:

Self-interest helps achieve society's economic goals because as consumers and producers exercise their<u> freedom</u> to act in their own self-interest markets will produce the desired goods at the<u> lowest </u>possible cost.

5 0
3 years ago
A source document that an employee uses to report how much time was spent working on a job or on overhead activities and that is
Ira Lisetskai [31]

Answer:

Time ticket

Explanation:

A source document that an employee uses to report how much time was spent working on a job or on overhead activities and that is used to determine the amount of direct labor to charge to the job or to determine the amount of indirect labor to charge to factory overhead is called a: time ticket.

A time ticket also known as time card is type of document used to record the amount of hours an employee worked during a pay period. Time tickets come in all different shapes and sizes like the traditional time tickets that are physical cards that are stamped with starting and ending times of employees work days.

3 0
3 years ago
A company has many underutilized compute resources on-premises. which aws cloud feature will help resolve this issue?
BaLLatris [955]

AWS cloud feature will help resolve this issued as<u> Elasticity.</u>

<u></u>

<h3>What is elasticity ?</h3>

Elasticity is an economic measure of how sensitive one economic factor is to changes in another. For example, changes in supply or demand to the change in price, or changes in demand to changes in income.

<h3>What is Hooke's law of elasticity?</h3>

Hooke's law, law of elasticity discovered by the English scientist Robert Hooke in 1660, which states that, for relatively small deformations of an object, the displacement or size of the deformation is directly proportional to the deforming force or load.

<u></u>

To learn more about Elasticity, refer

brainly.com/question/5078326

#SPJ4

7 0
1 year ago
Review Key Concepts
notsponge [240]

Explanation:

1. Because marketing of goods must comply with current marketing practices. Trends and consumer perceptions must be maintained. It is important.

This refers to the acquisition, distribution, and marketing of goods, services or trademarks, such as advertisement and market analysis, and the production of the products for customers or end-users.

2. An example of an economic good and an economic service :

Economic goods: cars, furniture, television, and clothing

Economic services: cooking a hamburger, cutting hair

3 0
3 years ago
According to the "marketing rules" we discussed in class, if you cannot be first in a product category, Group of answer choices
ozzi

Answer:

B) change your promotional campaign

Explanation:

A company should advertise that it is the no.1 selling product X in the market

8 0
3 years ago
Other questions:
  • A company had a beginning balance in retained earnings of $45,000. It had net income of $8,000 and paid out cash dividends of $6
    9·1 answer
  • An increase in the money supply will have the greatest effect on real gross domestic product if
    14·1 answer
  • Channel richness is, in part, determined by the ability to facilitate rapid, two-way feedback.
    7·1 answer
  • Seeing a brand can cause consumers to automatically think of the attributes of the firm. True or False
    8·1 answer
  • A disadvantage of forming a partnership is that ownersa) can find it tougher to start and stop a business.b) can find it more di
    9·2 answers
  • Ruddick Corporation is a manufacturer that uses job-order costing. The company has supplied the following data for the just comp
    9·1 answer
  • Explain the component of general environment ?​
    10·1 answer
  • Electronic résumés have an attractive, highly formatted appearance. T F​
    11·2 answers
  • question content area in recording the cost of goods sold for cash, based on data available from perpetual inventory records, th
    10·1 answer
  • One of the widely acknowledged problems with using the consumer price index as a measure of the cost of living is that the CPI a
    9·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!