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natta225 [31]
3 years ago
8

In a neoclassical economy, assume that the government lowers both government spending and taxes by $100 billion. If the marginal

propensity to consume is 0.6, investment will: Group of answer choices rise by $100 billion. not change. rise by $40 billion. rise by $60 billion.
Business
1 answer:
Zigmanuir [339]3 years ago
3 0

Answer:

rise by $40 billion

Explanation:

Calculation to determine what the investment will be

Investment=$100 billion*(100%-60%)

=$100 billion*40%

=$40 billion

Therefore the investment will rise by $40 billion

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Answer:

Six Sigma is a specific measure of quality, representing 3.4 defects per million opportunities and is used to designate a set of methodologies and techniques for improving quality and reducing costs.

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3 years ago
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Suppose you deposit ​$1400 cash into your checking account. By how much will checking deposits in the banking system increase as
grin007 [14]

The rounded nearest dollar is \$12727.27

<u>Solution:</u>

Deposit multiplier is a feature that explains how much money banks create when they loan money to borrowers.  

The sum for the banks to lend is the amount of money kept by the banks above the appropriate balance.

It is the key element of a fractional banking reserve system.

Banks in the United States must meet Federal Reserve minimum requirements, but they can set higher deposits multiplier.

Change in deposit = \$1400

RRR = 0.110

Change in the Money supply = (Change in the Monetary base) \times (Money multiplier)

Money multiplier= 1 \div \text{ reserve ratio }=\frac{1}{0.110}=9.091

Change in money supply= 1400\times9.091= \$12727.273 that is approximately 12727.27 dollars.

5 0
3 years ago
An economic expansion tends to cause the federal budget deficit to ________ because tax revenues ________ and government spendin
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An economic expansion tends to cause the federal budget deficit to decrease because tax revenues rise and government spending on transfer payments falls.

What is economic expansion?

Economic expansion occurs when real GDP raises from a trough to a peak within two or more subsequent quarters. The expansion occurs during times of economic stimulation when there is a rise in employment, followed by consumer confidence and discretionary spending. The stage is additionally referred to as economic recovery. When expansion reaches its pinnacle, a peak happens. With a large sum of demand for goods, inflation occurs when costs begin to increase. Gradually, consumers begin to buy less. After reaching the peak, economic growth starts to decrease. While the phrases inflation and deflation refer to rising and falling prices of commodities, goods, and services relative to the value of money, economic contraction and expansion refer to the overall output of all goods and services.

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6 0
2 years ago
Assume the spot market exchange rate for $1 is currently A$1.1904. The expected inflation rate is 3.3 percent in Australia compa
vodomira [7]

Answer: c. $1.1964

Explanation:

The Expected Rate is calculated as follows,

Expected Rate = ((1+ Australia inflation rate)/(1+ U.S inflation rate)) *spot rate

Plugging in the figures therefore we will have,

Expected Rate = ((1+0.033) / (1 + 0.028)) * 1.1904

Expected Rate = $1.1964

$1.1964 is the expected exchange rate one year from now if relative purchasing power parity exists.

6 0
3 years ago
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A management control system is a logical integration of techniques to gather and use data and to evaluate performance.
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Answer:

The correct answer is the option A: True.

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To begin with, a <em>management control system</em> is understood as an ensemble of different subsystems that work with each other in order to cooperate to do the task and obtain the objectives that the user is looking for. In this case in particular, this type of system focus primarily in the objective of gathering data with the purpose of using it to evaluate the performances of the members of the organization so that would help the manager to take decisions when he has to. That is why that this system is a logical integration of techniques that would ensemble data to be used.

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4 years ago
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