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Rainbow [258]
3 years ago
5

If the spending multiplier equals 5 and equilibrium income is $2 billion below potential GDP, then _____ to reach the potential

real GDP level. Group of answer choices total spending needs to increase by $0.1 billion nominal GDP needs to increase by $1.2 billion total spending needs to decrease by $6 billion nominal GDP needs to decrease by $12 billion total spending needs to increase by $0.4 billion
Business
1 answer:
rosijanka [135]3 years ago
3 0

Answer:

total spending needs to increase by $0.4 billion

Explanation:

Calculation to determine how much total spending needs to increase or decrease

Using this formula

Increase or Decrease in total spending=Equilibrium income/Spending multiplier

Let plug in the formula

Increase or Decrease in total spending=$2 billion/5

Increase or Decrease in total spending=$0.4 billion

Therefore If the spending multiplier equals 5 and equilibrium income is $2 billion below potential GDP, then TOTAL SPENDING NEEDS TO INCREASE BY $0.4 BILLION to reach the potential real GDP level.

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B. Expert power

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Joint products A and B emerge from common processing that costs $116,000 and yields 4,000 units of Product A and 2,800 units of
Mandarinka [93]

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Apportioned joint cost to A=$92,800

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<em>Joint costs are the costs incurred up until the split-off where two or more products result from the same production process. These  common costs need to be apportioned among the joint products using any of the following basis:</em>

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4 0
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Answer: a. Accounts Receivable

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This method of Accounting violates the Matching Principle under the Accrual basis because it usually does not recognize bad debts in the same period that the inventory was sold. It only records bad debts when they are declared which could be periods afterwards.

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Answer:

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