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sweet-ann [11.9K]
3 years ago
5

Arthur, the ruler of Avalon, has asked for your help with the economy of his country. Arthur's economic minister provides you wi

th the following information:Work-eligible population: 30 million Labor force: 24 million Employed people: 21 million Frictionally unemployed people: 2 million Structurally unemployed people: 1.5 million Arthur would like to know whether his kingdom is enjoying an expansion or suffering a recession. See if you can advise him. Give all numeric answers to two decimals.King Arthur, right now Avalon's unemployment rate is _____%, but Avalon's natural rate of unemployment is ___%. Therefore, the Avalon economy is currently in a(an) (enter expansion or recession).
Business
1 answer:
WARRIOR [948]3 years ago
8 0

Answer:

King Arthur, right now Avalon's unemployment rate is <u>12.5%</u> but Avalon's natural rate of unemployment is 14.58%. Therefore, the Avalon economy is currently in a expansion.

Explanation:

Number of Unemployed = Labor force - Employed

Number of Unemployed = 24 - 21

Number of Unemployed = 3

The unemployment rate = (3/24)*100

The unemployment rate = 12.5%

The Natural unemployment rate = Frictional Rate + Structural unemployment Rate

The Natural unemployment rate = [(2+1.5)/24]*100

The Natural unemployment rate = (3.5/24) * 100

The Natural unemployment rate = 14.58%

From the solution, the current unemployment rate less than natural rate,  thus the Avalon economy is currently in a expansion

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Studies indicate that the price elasticity of demand for beer is about 0.9. A government policy aimed at reducing beer consumpti
Aleonysh [2.5K]

Answer:

The government policy should have reduced beer consumption by 0.6 or 60%

Explanation:

Mid point formula calculates the ratio of mid point of change in demand and change in price to their average value. Then these changes are used in the calculations of elasticity of demand.

According to given data:

Elasticity of demand = 0.9

Midpoint of price  = (20-10) / [(20+10)/2] = 10 / 15 = 0.6667

Elasticity of Demand = Midpoint of demand / Midpoint of price

0.9 = Midpoint of demand / 0.6667

Midpoint of price = 0.9 x 0.6667 = 0.6

Change in demand is should reduce the consumption by 0.6 or 60%.

4 0
3 years ago
Read 2 more answers
A company records an adjusting journal entry to record $10,000 depreciation expense. Which of the following describes the entry?
Pavlova-9 [17]

Answer:

(B) Debit Depreciation expense and Credit Property Plant and Equipment

Explanation:

the depreciation is the accrued expense recognize for the effect on time on the firm's assets. There is no cash involve in a depreciation It is an accounting expense. So A and C cannot be coorect.

As the depreciation is an expense, it will be debited. not credited. so D is incorect as well.

The net income is a figure which resumes the expenses and revenues of the company. It is not an account thus, it can't be debited or credited. Making E incorrect as well.

8 0
3 years ago
what is the present value of $500 recieved at the end of each year for 15 years? ( assume thatt the first patyment is recieved a
Eva8 [605]

Answer:

$3800

Explanation:

Present value is the sum of discounted cash flows

Present value can be calculated using a financial calculator

Cash flow fromyear 1 to 15 = 500

I = 10%

PV = 3800

To find the PV using a financial calculator:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.  

4 0
2 years ago
On january 1, year 2, kincaid company's accounts receivable and the allowance for doubtful accounts carried balances of $31,000
Gala2k [10]

Answer:

$27,725

Explanation:

Given that,

kincaid company's accounts receivable = $31,000

Allowance for doubtful accounts at January 1 = $500

Wrote off receivables as uncollectible = $550

1% of credit sales

cash collections of receivables = $74,550

Accounts receivable:

= Accounts receivable at January 1 + Credit sales - Wrote off receivables as uncollectible - Cash collection of receivables

= $31,000 + $72,500 - $550 - $74,550

= $28,400

Accounts for Doubtful Accounts:

= Allowance for doubtful accounts at January 1 - Wrote off receivables as uncollectible + 1% of credit sales

= $500 - $550 + (0.01 × $72500)

= $500 - $550 + $725

= $675

Net realizable value of receivables:

= Accounts receivable - Accounts for Doubtful Accounts

= $28,400 - $675

= $27,725

Therefore, the net realizable value of receivables appearing on kincaid's year 2 balance sheet will amount to $27,725.

3 0
3 years ago
A firm’s stock is expected to pay a $2 annual dividend next year, and the current $50 stock price is expected to rise to $60 ove
pochemuha

Answer:

Expected rate of return will be 24%

So option (b) will be correct option

Explanation:

We have given dividend in next year will be $2

So dividend D_1=2$

Current stock price P_0 = $50

And it is given that in next year stock price is $60

So growth rate =\frac{60-50}{50}=0.2 = 20%

We have to find the expected return after 12 month, that is after 1 year

We know that current price is given by P_0=\frac{D_1}{R_e-g}

50=\frac{2}{R_e-0.2}

50R_e-10=2

50R_e=12

R_e=0.24 = 24%

So expected rate of return will be 24%

So option (B) will be correct option

3 0
3 years ago
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