All categories

2 years ago

Because of the compounding effect:

Business

1 answer:

luda_lava [24]2 years ago

6 0

Answer: c. small changes in economic growth rate lead to large GDP changes over time.

Explanation:

If there is even a small change in the rate at which the economy is growing, this increase will increase by even more the year afterward and then even more as time goes on. This is because the interest is being compounded overtime.

Look at the future value formula that shows compounding for instance:

Future value = Amount * (1 + rate) ^ number of periods

Assume even a change of 2% in the growth rate. In 30 years, this rate would have increased the economy by:

= 1 * ( 1 + 2%)³⁰

= 1.81

Which is a rate of:

= 1.81 - 1

= 81%

What started off as only 2% became 81% in 30 years. This is what compounding does.

You might be interested in

Suppose that Dmitri, an economist from an AM talk radio program, and Frances, an economist from a school of industrial relations

lions [1.4K]

Answer:

1. The disagreement between these economists is most likely due to

a. differences in values

2. Despite their differences, with which proposition are two economists chosen at random most likely to agree?

a. Lawyers make up an excessive percentage of elected officials.

Explanation:

Economists chosen at random do not usually agree on economic events and realities, instead, they are more likely to agree on issues that are not economic. They offer differing opinions based on similar principles. Most of their disagreements stem from differences in what they place their values on. Some value market-oriented approaches while others value government interventions in market situations, with other variants in-between.

7 0

3 years ago

Crayola Technologies Inc. has contacted Rubium with an offer to sell 6,000 of the subassemblies for $144.00 each. Rubium will el

AURORKA [14]

Answer:

Make, Savings = $1,000

Explanation:

If Rubium company makes, they can avoid -

Total Variable cost = $(54 + 35 + 40)*6,000 units = $774,000

Total Fixed cost = $89,000

Therefore, total cost = $774,000 + 89,000 = 863,000

Again, if Rubium purchases from Crayola Technologies Inc., the cost will be

$144 x 6,000 units = $864,000

So, Purchasing cost is larger than making cost. Therefore, Rubium company should make the sub-assemblies.

The difference between making and purchasing is = $(864,000-$863,000 = $1,000

Therefore, savings = $1,000

4 0

3 years ago

In a process costing system, when manufacturing overhead costs are applied to the cost of production, they are debited to: Multi

Sav [38]

Answer:

the Work in Process Inventory account

Explanation:

The journal entry to record the manufacturing overhead costs applied to the cost of production includes -

Debit Work in Process Inventory account XXXX

Credit Manufacturing overhead XXXX

As the work is in progress, it cannot be a finished goods inventory or even a cost of goods sold account. Again, raw materials inventory will not come here as manufacturing overhead costs assigned to the cost of production. Therefore, option C is correct.

6 0

3 years ago

During January, the production department of a process operations system completed and transferred to finished goods a total of

amm1812

Answer:

$ 3.7167

Explanation:

Given:

Number of goods completed and finished = 78,000 units

Additional units produced = 9000

Number of units completed from the additional units = 65% of the units produced

i.e 0.65 × 9000 = 5,850 units

therefore, the total units completed = 78,000 + 5,850 = 83,850 units

Labor cost for the beginning inventory = $ 21,650

Direct labor cost = $ 290,000

Therefore, the total labor cost = $ 21,650 + $ 290,000 = $ 311,650

thus,

Direct Labor Cost per Unit = ( Total labor cost ) / ( Total completed Units )

Direct Labor Cost per Unit = $ 311,650 / 83,850 = $ 3.7167 / unit

Hence,

<u>the direct labor cost per equivalent unit for the department = $ 3.7167</u>

4 0

3 years ago

Linda’s Autoplex performs oil changes on automobiles, light trucks, and sport utility vehicles. She is a profit- maximizing busi

Usimov [2.4K]

Answer:

$15 per hour

Explanation:

In order for a profit maximizing firm to operate in a competitive market, the marginal revenue product (MRP) must be equal to the marginal cost (MC).

MRP = 1.5 oil changes per hour x $10 per oil change = $15

since MRP = MC, then Linda should pay her worker a maximum of $15 per hour

8 0

3 years ago