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mash [69]
3 years ago
5

Imagine that in 2019 the economy is in long-run equilibrium. Then stock prices rise more than expected and stay high for some ti

me. Refer to Scenario 33-2. In the short run what happens to the price level and real GDP
Business
1 answer:
V125BC [204]3 years ago
6 0

In the short-run, the effect on the price level and the real GDP is <em>a. Both the </em><em>price level </em><em>and </em><em>real GDP </em><em>rise.</em>

Since the economy is in long-run equilibrium in 2019, and the stock prices unexpectedly rise and stay high for a long time, it means that the price level does not:

  • Rise while the real GDP falls
  • Fall while the real GDP rises
  • Fall with the real GDP.

<u>Question Options</u>:

a. both the price level and real GDP rise.

b. the price level rises and real GDP falls.

c. the price level falls and real GDP rises.

d. both the price level and real GDP fall.

Thus, in the short-term of this economy both the price level and real GDP rise.

Learn more: brainly.com/question/13029724

You might be interested in
If Chester's current cash balance is $26,337 (000) and Cash Flows From Operations next period are unchanged from this period, wh
JulijaS [17]

Answer:

The correct option is c. Purchases assets at a cost of $25,000,000.

Explanation:

An emergency loan can be described as a loan that can obtained on short notice by a borrower in to cover unexpected costs.

From the options, purchasing assets at a cost of $25,000,000 will leave Chester in a serious liquidity position as the it will take 94.92% [i.e. ($25,000,000 / $26,337,000) * 100] of its current cash balance and leave the company with just $1,337 current cash balance.

Because the next period's Cash Flows From Operations are expected to be the same as this period's, purchasing assets at a cost of $25,000,000 puts Chester at the greatest danger of needing an emergency loan.

Therefore, the correct option is c. Purchases assets at a cost of $25,000,000.

7 0
3 years ago
The cost C and the revenue R for a brokerage firm depend on the number T of transactions executed. (Both C and R are measured in
marusya05 [52]

Answer:

C(T) = $730 + $25T

R(T) = $35T

T = 193 transactions

Explanation:

Given that:

C = cost ; R = revenue ; T = number of transactions

Amount paid per transaction = $25

Cost keeping office open = $730

Amount collected on each transaction = $35

(a) Find a formula that gives C as a function of T.

C(T) = Cost of keeping office open + (cost per transaction × number of transactions)

C(T) = $730 + $25T

(b) Find a formula that gives R as a function of T.

R(T) = (Amount collected per transaction * number of transactions)

R(T) = $35T

(c) Find the number of daily transactions that are needed to make the revenue $1200 more than the cost.

R = C + 1200

Substitute the value of R and C into the equation:

35T = 730 + 25T + 1200

35T - 25T = 730 + 1200

10T = 1930

T = 1930 / 10

T = 193 transactions

6 0
4 years ago
The Car Service Center has the design capacity to perform an average of 60 repairs per day. The effective capacity of this repai
ELEN [110]

Answer:

(36 /60 ) * 100

Explanation:

Based on the information given the capacity  utilization percentage will be :

Capacity  utilization percentage= (36 /60 ) * 100

Capacity  utilization percentage=60%

Where,

36 per day represent Actual repairs number

60 repairs per day represent Design capacity

Therefore capacity utilization percentage is (36 /60 ) * 100

7 0
3 years ago
Suire Corporation is considering dropping product D14E. Data from the company's accounting system appear below: Sales $ 600,000
atroni [7]

Answer:

$127,000

Explanation:

Suire Corporation Net operating income

Sales $ 600,000

Variable Costs $ 241,000

Contribution Margin $ 359,000

Fixed Expenses $232,000

Net Operating Income $127,000

6 0
3 years ago
An investor prefers to invest in companies that have high operating leverage. How can this be accomplished if the investor also
Fittoniya [83]

Answer:

B

Explanation:

Systemic risk are risk that are inherent in the economy. They cannot be diversified away. They are also known as market risk. examples of this risk include recession, inflation, and high interest rates. Investors should seek compensation for systemic risk. Systemic risk is measured by beta. The higher beta is, the higher the systemic risk and the higher the compensation demanded for by investors

Market index fund is riskless and would have a beta of 1

by investing half in a riskless and half in a risky asset. beta would be equal to 1

3 0
3 years ago
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