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Virty [35]
3 years ago
5

a. How can increases in government spending crowd out investment spending? An increase in government spending increases the use

of automatic stabilizers, which reduces private investment spending. causes firms to worry about inflation, which reduces private investment spending. increases the real interest rate, which reduces private investment spending. lowers the real interest rate, which reduces private investment spending. b. Is crowding out a major concern when actual output is below potential output? Why? Crowding out is a major concern, because the goal is always to increase investment spending. is not a major concern, because the Fed will likely lower the real interest rate when actual output is far below potential. is a major concern, because the crowding out effect will outweigh the increase in government spending. is not a major concern, because the Fed will likely raise the real interest rate when actual output is above potential output.
Business
1 answer:
Delvig [45]3 years ago
4 0

Answer:

         a.  increases the real interest rate, which reduces private investment spending.

        b.  is not a major concern, because the Fed will likely lower the real interest rate when actual output is far below potential.

Explanation:

Increase in government spending means that the government would probably have to borrow money from the credit market. Because the government is so large, it will borrow in large amounts which would force rates to rise. At these higher rates, the private sector might find it too expensive to borrow money and so would be crowed out such that they reduce their investment spending.

When the economy is facing an output that is lower than potential, the Fed will engage in monetary policy aimed at reducing interest rates to improve investment spending. This therefore negates the effect of crowing out which means that it would no longer be a major concern.

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Utica Company has offered to supply Kingston's entire annual requirements of the part for $53 each. If Kingston buys the part fr
miss Akunina [59]

Answer:

$480,000

Explanation:

Calculation to determine what total relevant costs to make the part internally are

First step is to calculate Relevant cost per unit:

Relevant cost per unit:

Direct materials $6

Direct labor $24

Variable manufacturing overhead $12

Fixed manufacturing overhead ($15 × 0.40) $6

Relevant manufacturing cost $48

Now let determine the Total relevant costs to make the part internally

Total relevant costs to take the part internally=($48 × 10,000)

Total relevant costs to make the part internally = $480,000

Therefore total relevant costs to make the part internally are $480,000

5 0
3 years ago
​U(X,Y)equals=20Xplus+80Yminus−Upper X squaredX2minus−2Upper Y squaredY2 where X is his consumption of CDs with a price of ​$11
ankoles [38]

Answer:

The number of CDs = 111.36

The number of movie videos = 242.72

N/B: I choose not to round up the answers.

Explanation:

The method used is the Lagrangian method. Basically, the optimization problem we are trying to solve is  the utility function u(x,y) = 20x+80y -x^2 -y^2

subject to the constraint

11x + 22y = 6565.

So the optimization problem(Lagrangian) is

\Delta = 20x + 80y -x^2 -y^2- \lambda(11x+22y-6565),

where \lambda is a constant called the Lagrange multiplier.

To find the optimal consumption, we need to maximize the Lagrangian with respect to the variables x,y,\lambda. This we do by differentiating \Delta with respect to each variable and then equate to 0.

\Delta_x : 11\lambda = 20 - 2x ........................(1) \\\Delta_y: 11\lambda = 40 -y .........................(2) \\\Delta_\lambda = 11x + 22y = 6565............................(3) \\

Equate (1) and (2), to get y = 20+2x and substitute into (3) to get x = 111.36. Substituting x = 111.36 into 20+2x to get the corresponding value of y.

7 0
3 years ago
Who is the first lady president in the world
melamori03 [73]

Answer:

Isabel Martínez de Perón

Explanation:

Isabel Martinez de Perón of Argentina was the very first woman or lady to serve as leader of a country as president, taking over as vice president following her husband died in 1974.

On July 21, 1960, Sirimavo Bandaranaike was chosen as the world's first women Prime Minister.

5 0
3 years ago
Suppose the price of gasoline decreases from $4.20 to $2.00, and in response quantity demanded increases from 10600 to 11200. Us
Tems11 [23]

Answer:

0.079

Explanation:

Price elasticity of demand using midpoint formula can be calculated as follows

Formula

Elasticity of demand = (change in quantity/average quantity)/(change in price/average price)

Calculation

Elasticity of demand = (600/10,900)/(-2.1/3.05)

Elasticity of demand =-0.055 / -0.688

Elasticity of demand =-0.079

working

Change in price (2-4.1) = -2.1  

Average price (2+4.1)/2=3.05

Change in quantity (11,200-10600) = 600

average quantity (11,200+10,600)/2 = 10,900

 

The elasticity of demand is inelastic as the elasticity is below 1.

4 0
3 years ago
According to naoroji, what benefits has india received as a result of british rule? check all that apply. understanding of india
Zarrin [17]
The two correct options are:
peace, stability, and order.
new technologies and infrastructure. 

4 0
3 years ago
Read 2 more answers
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