Answer:
True. The answer and procedures of the exercise are attached in a microsoft excel document.
Explanation:
Please consider the data provided by the exercise. If you have any question please write me back. All the exercises are solved in a single sheet with the formulas indications.
Answer:
The correct answer is D. will result in a multiple times higher decrease in equilibrium real GDP in the short run; however, a tax-rate reduction will increase the automatic-stabilizer properties of the tax system, so equilibrium real GDP would be less stable.
Explanation:
Ricardian Equivalence is an economic theory that suggests that when a government increases expenses financed with debt to try to stimulate demand, demand does not really undergo any change.
This is because increases in the public deficit will lead to higher taxes in the future. To keep their consumption pattern stable, taxpayers will reduce consumption and increase their savings in order to offset the cost of this future tax increase.
If taxpayers reduce their consumption and increase their savings by the same amount as the debt to be returned by the government, there is no effect on aggregate demand.
The fundamental concept of Ricardian equivalence is that it does not matter which method the government chooses to increase spending, whether by issuing public debt or through taxes (applying an expansive fiscal policy), the result will be the same and demand will remain unchanged.
Answer:
d. purchase the machine because each partner has one vote in management matters
Explanation:
Since in the question it is mentioned that the partners vote whether or not to buy a new machine for $100 so the violet and William would agree on this but Xavier does not agree
Now according to this situation the machine should be purchased as each partner vote is necessary also there is a majority of 2 person to buy the machine
hence, the option d is correct
Answer: The amount the company would recognize is $100 as a gain from foreign currency translation.
Explanation: On October 1, a receivable of $2,860 (2,000 pounds x $1.43) would have been recorded. However, this amount of receivable has to be revalued using the year-end rate of $1.45, based on the principles of <em>IAS 21 The Effects of Changes in Foreign Exchange Rates</em>. Year-end receivable would then be $2,900 (2,000 pounds x $1.45). A foreign exchange gain of $40 would be recognised by debiting receivable and crediting gain on foreign currency translation (which reports in income statement) with $40 ($2,900 - $2,860). This is necessary to revalue the receivable using the year-end rate. Subsequently, the spot rate moved to $1.50 at the point of collection, this simply means the company has made a $100 exchange gain (2,000 pounds x $1.50 = $3,000 - $2,900). The journal entries to be raised would be Debit Cash $3,000; Credit Receivable $2,900, Credit Exchange gain (income statement) $100.