(d.) ECONOMIES OF SCALE
Economies of scale is achieved when the average goods and services decrease whereas the volume of the goods and services increases.
Diseconomies of scale is achieved when the average unit cost of goods and services increases with the increase in the volume of goods and services.
Frequent, likely, occasional, seldom, and unlikely are the five categories of probability in the Risk Assessment Matrix which means the likeliness that an adverse or critical event will occur. The purpose of Risk Assessment Matrix is to estimate the degree of severity and probability for each hazard.
I do not agree that “the only beneficiary of the entrepreneurial wealth is the entrepreneur him/herself.”
The entrepreneur may be the chief beneficiary when she is alive to reap the rewards of their entrepreneurial efforts. But, she is certainly not the only beneficiary of the entrepreneurial wealth that she creates. Nobody works in isolation. When the entrepreneur commences her business, society as a whole benefits because any individual wealth created increases the wealth of the nation and the world. She only gets the profit share of the created wealth. Customers who patronize her services and goods also derive satisfaction of needs (utility or value). The entrepreneur's wealth is also shared to the government in form of taxes. Suppliers of primary goods and services also share in the wealth of the entrepreneur. And employees of the entrepreneur also take a large share of the created wealth.
But, who is an entrepreneur? She is somebody who assumes some entrepreneurial (first-time) risks in order to set up a business for the manufacture or provision of goods and services for the purpose of profit. Her business may not be profitable in the short-run. She can even lose tons of money initially until the profit stage sets in. As she preserves, the profits will start rolling in, provided she had done her homework well.
Answer: Increase and ad will shift right to long-run equilibrium.
Explanation: A decrease in Taxes lead to an increase in the disposable income of the consumers. This results in higher consumer spending at the given income levels. As a result the AD curve shifts to the right towards the long run equilibrium level.
Answer:
$250 billion.
Explanation:
The computation in the increase in real GDP is shown below:
Given that
MPC = 80% or 0.80
Income multiplier = 1 ÷ (1 - MPC
)
= 1 ÷ (1 -0.80
)
= 1 ÷ 0.20
= 5
Now
The Increase in disposable income is $50 billion
So,
The Increase in real GDP is
= 50 × 5
= $250 billion
We simply applied the above formula so that the correct value could come
And, the same is to be considered
