If the multiplier equals 2 and the AD shortfall is $6 million, the desired fiscal stimulus is $3 million.
<h3>What is the shortfall?</h3>
The term shortfall has referred to the deficiency of something in the market. When the availability of goods is not adequate and suppliers fail to provide them. This situation is considered as shortfall.
To calculate the desired fiscal stimulus
desired fiscal stimulus= AD shortfall/ Multiplier
=$6 million/ 2
= $3 million
Therefore, the desired fiscal stimulus is $3 million.
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Answer:
Increased government spending will be less effective for raising the Marginal Propensity to Consume.
Explanation:
The Marginal Propensity to Consume depends on disposable income, and disposable income is the money that individuals have after paying tax.
If the government increases spending, it will also increase taxes to finance spending, and if taxes are higher, people will have less disposable income, and even if their marginal propensity to consume increases, because they now have less money, the will spend less in total.
Answer:
$7,200 favorable
Explanation:
The computation of the material quantity variance is shown below:
= Standard Price × (Standard Quantity - Actual Quantity)
= $4 per gallon × (2 gallons × 7,000 units - 12,200 gallons)
= $4 per gallon × (14,000 - 12,200 gallons)
= $4 per gallon × 1,800 gallons
= $7,200 favorable
All other information which is given is not relevant. Hence, ignored it
Answer:
demographic
Explanation:
Demographic segmentation is defined as a market segmentation method based on variables such as age, gender, income etc. ... Demographic attributes like age, sex, gender, religion, and educational qualification, play an important role in research
Answer:
Lahdekorpi OY, a Finnish corporation and Three-O Company, a subsidiary incorporated in the United States
Transfer Pricing:
a) The best transfer pricing method in this case is the cost plus method. This gives the transfer price as Cost + 50%.
b) The appropriate transfer price should be $3 ($2 x 1.5).
Explanation:
Transfer pricing arises when controlled entities set prices for exchange of goods and services. When Lahdekorpi OY, a Finnish corporation, sells wooden puzzles to Three-O Company, given their relationship, transfer pricing has arisen. It is the assignment of cost for goods and services exchanged between related parties, like a parent and a subsidiary.
There are many Transfer Pricing methods which entities and the taxing authorities can use to determine the best transfer price. According to the Organisation for Economic Co-operation and Development (OECD) Multinational Entities and tax authorities can use any of these five main transfer pricing methods:
a) Comparable uncontrolled price (CUP) method. The CUP method is grouped by the OECD as a traditional transaction method (as opposed to a transactional profit method)
b) Resale price method
c) Cost plus method
d) Transactional net margin method (TNMM)
e) Transactional profit split method.
