Answer:
b. increases the interest rate and so investment spending increases.
Explanation:
According to the IS-LM framework,
An increase in government spending shifts IS upward resulting in higher interest rate as well as GDP. The higher interest rate will hamper investment spending.
Answer:
Amount of a product people purchase at various prices. ... There exists an inverse relationship between price and quantity demanded. As the price of a good or service goes up, the number sold (quantity demanded) goes down. As the price of a good or serve goes down, the number sold (quantity demanded) goes up.
Answer:
Trade creation
Explanation:
Trade creation is the process where there is increase in economics welfare as a result of joining a free trade area for example a customs Union.
Consumption experiences a shift from high cost producers to low cost producers causing expansion in trade.
In the given instance due to formation of free trade agreement, high cost plastic production is now replaced with low cost import of plastics from the other company.
There is a shift from high cost producers to low cost producers as a result of trade agreement between the two nations.
Answer:
The cash balance on November 30 amounts to $155,700
Explanation:
Cash balance on November 30 = Beginning balance + Collection of cash from October sales + Collection of cash from November sales - Payments for October Purchases - Payments for November Purchases
where
Beginning balance is $13,700
Collection of cash from October sales = October Sales × % amount collected
= $240,000 × 70%
= $168,000
Collection of cash from November sales = November Sales × % amount collected
= $240,000 × 1.20 × 25%
= $72,000
Payments for October Purchases = October Purchases × % amount paid
= $70,000 × 65%
= $45,500
Payments for November Purchases = November Purchases × % amount paid
= $150,000 × 35%
= $52,500
Putting the values in the above formula
Cash balance on November 30 = $13,700 + $168,000 + $72,000 - $45,500 - $52,500
= $155,700
