Answer:
Option (B) is correct.
Explanation:
Given that,
Required reserve ratio = 15 percent
Bonds sell to public = $25.5 million
Bank reserves decreases by $25.5 million because of the purchasing of bonds from the Fed.
Money multiplier:
= 1/Required reserve ratio
= 1/0.15
= 6.67
Therefore, the money supply decreases by:
= Money multiplier × $25.5 million
= 6.67 × $25.5 million
= $170 million
Answer:
Cr Interest revenue $3,624
Explanation:
Dr Investment in bonds 100,000
Cr Cash 90,000
Cr Discount on investment in bonds 10,000
the first coupon payment:
(90,000 x 4%) - $3,000 = $600
Dr Cash 3,000
Dr Discount on investment in bonds 600
Cr Interest revenue 3,600
the second coupon payment:
(90,600 x 4%) - $3,000 = $624
Dr Cash 3,000
Dr Discount on investment in bonds 624
Cr Interest revenue 3,624
Answer:
ROI = Net operating income x 100
Average operating assets
ROI = $1,924,320 x 100
$6,000,000
ROI = 32.1%
The correct answer is C
Explanation:
ROI is the ratio of net operating income to average operating assets multiplied by 100.
Answer and explanation:
Product costs are those that are linked to the manufacturing of a good such as direct materials, direct labor, and overhead. Period costs are not involved directly in the manufacturing process but are important for the business. Examples of period costs are administrative wages, sales commissions, or depreciation. Thus:
A) <em>Sales salaries </em>(Period Costs)
B) <em>Paper used for the magazine </em>(Product Cost)
C) <em>Maintenance on printing machines </em>(Product Cost)
D) <em>Depreciation expense-corporate headquarters </em>(Period Cost)
Equilibrium is the intersect of the two curves. The curves show you how much the producers supply and how much the consumers demand at each possible price.
The demand curves shows that the higher the price is, the less the consumers demand. That's obvious—the consumer wants something, but not at any price. He's only willing to pay so much. If the price goes higher and higher, less and less people want to buy the good.
The higher the price is, the more the producers can supply. This is because some producers are able to produce at lower costs; they're better and more efficient than other producers. Other producers, who produce at higher costs, would go bankrupt if they tried to produce at lower prices. But when the price goes up, even the worse producers, who have higher costs, are able to make profit. So, more producers supply to the market.
What happens now, when the price gets lower than the equlibrium? As you can see from the chart, producers would supply less than consumers would be willing to consume at that particular price. There would be SHORTAGE. This happens when the goverment sets price ceilings (like on gas in the 30's). An opposite situation happens when there is price floor—for example minimum wage (because wages are prices too; prices of labor). In that case, there is surplus—in case of minimum wage that means surplus of labor (unemployment).
But when the markets are free to set the price, they will quickly establish equlibrium again. The producers will see that there is a shortage. They'll realize they can set higher prices and make bigger profits. They can't set higher price than the equilibrium though, because there would be surplus and they would have their warehouses stuffed with goods noone wants to buy at that price.
This is the Answer Am 100% sure.
