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Nat2105 [25]
3 years ago
11

If the economy is initially in equilibrium at full employment real GDP (QN), and a stock market crash reduces household wealth a

nd lowers investor confidence, ceteris paribus, the ____________ curve will shift to the ____________ resulting in a ____________ price level (P), ____________ output/real GDP level (Q), and ____________ unemployment level (U).
Business
1 answer:
raketka [301]3 years ago
4 0

Answer: aggregate demand; left; lower; lower; higher

Explanation:

If the economy is initially in equilibrium at full employment real GDP (QN), and a stock market crash reduces household wealth and lowers investor confidence, ceteris paribus, the (aggregate demand) curve will shift to the (left) resulting in a (lower) price level (P), (lower) output/real GDP level (Q), and (higher) unemployment level (U).

It should be noted that the crash in the stock market will lead to lesser funds in the economy and lessee funds with households and this will lead to reduction in the demand for goods which will shift the demand curve to the left.

aggregate demand; left; lower; lower; higher

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Answer:

the amount paid for stock reacquired and currently held in treasury

Explanation:

Treasury stock is an equity account and it is equal to:

  • total shares issued - total shares outstanding

Treasury stock increases when a corporation repurchases outstanding stock for the purpose of reselling them later or retiring them. This usually happens when the corporation has more cash than needed or the price of the stock is too low.

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$40.79 per share and $52.90 per share

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Weight of Equity = $8.94

WACC = 30% * 4.38% + 70% * 13.70% = 10.9%

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