In an economy, the government wants to increase aggregate demand by $50 billion at each price level to increase real GDP and reduce unemployment. If the MPC is 0.6, then it would increase government purchases by
$10 billion.
$20 billion.
$31.25 billion.
$40.50 billion.
If the reserve requirement is 20% and commercial bankers decide to hold additional excess reserves equal to 5% of any newly acquired checkable deposits, then the effective monetary multiplier for the banking system will be
3. or
4.or
5.or
6.
Answer:
113,000.
Explanation:
Let go through all the items to see whether we need to include them in the initial outlay or not.
(1) $100,000 worth of equipment => Yes
(2) Shipping will cost $5,000 and installation will cost $8,000 => Yes (Add to purchase price of equipment)
(3) Paid a management consultant $4,000 to analyze this project => No =>This is sunk cost (already incurred regardless of accept or reject the prject)
(4) Increase sales by $20,000 per year => No => under operating cashflow.
(5) $3,500 to train the employees to use the new equipment => No => under operating cashflow.
So, total initial outlay = 100,000 + 5,000 + 8,000 = 113,000.
Answer:
The answer is <u>"2.04%".</u>
Explanation:
Purchase price = $490,000
Selling price = $500,000
Percentage return on his investment = ?
Return on investment = Profit / Purchase price
Profit = Selling price − Purchase price
Return on investment = (Selling price − Purchase price) / Purchase price
= ($500,000 - $490,000) / $490,000
= $10,000 / $490,000
= 0.0204
To find percentage, multiply it with 100;
0.0204 x 100 = 2.04%
Thus the percentage return on his $490,000 investment = <u>2.04%</u>
Answer:
worker is protected by a cost-of-living adjustment clause in an employment contract
Explanation:
Cost of Living Adjustment(COLA) is an increase made to income from social security to counter the inflationary effects. The COLA change is essentially equivalent to the Consumer Price Index ( CPI) percentage increase over a given period.
All other options are wrong as it is not fit to the current situation
hence, the correct option is B.
Answer:
The monetary base remains unchanged
Explanation: