Answer:
This is a false statement.
Explanation:
Price has certain effect on the demand of a product.
An increase in price may lead to higher demand while an decrease in price may lead to lower demand.
The increase or decrease in demand following the fall or rise in price varying amount different products.
Product demand is said to be elastic when a change in price has relatively big effect in the demand while it is said to be inelastic when a change in price lead to little change in demand of a product.
As a result, the statement quote in the question is false. Demand for a good should be said to be elastic instead given the quantity demanded increases substantially when the price falls by a large amount.
Answer:
Explanation:
In this question ,we take the difference of the per bond value based on the year. The computation is shown below:
During 2015 to During 2017:
= Number of bonds purchased × (December 31, 2017 value - 2015 value)
= 10,000 × ($92 - $61)
= 10,000 × $31
= $310,000
During 2018:
= Number of bonds purchased × (December 31, 2018 value - 2017 value)
= 10,000 × ($146- $92)
= 10,000 × $54
= $540,000
So, the total amount would be
= $310,000 + $540,000
= $850,000
This amount which reflect in the income statement as a realized gain
Answer: $321,020
Explanation:
The cash flow is expected to grow at a rate of 8%.
This means that in the next year it will be 8% higher than the $297,241 it is in the current period.
= 297,241 * ( 1 + rate)
= 297,241 * ( 1 + 8%)
= $321,020
Answer:
All answers are correct except Money Supply
Explanation:
Fiscal policy affects aggregate demand through government spending and taxes. Government may increase taxes to increase revenue or discourage the consumption of a product. On the flipside, they may reduce taxes to stimulate spending, redistribute income, increase aggregate demand among other objectives.
Money supply is a monetary policy and it is used by the central bank to achieve certain objectives (reduce inflation, stimulate growth, increase demand, etc.)
Government spending is a fiscal policy that government uses to achieve a set of objectives (i.e. to supply goods and services that are not provided by the market or private sector – construct bridges, provide health facilities, social programmes for the poor among others).
Taxes – Tax is a fiscal policy tool used by the government to generate revenue, encourage or discourage the consumption of certain products or affect aggregate demand through income redistribution.
Trade policy could be in the form taxes (i.e. tariffs, import duties, custom duties among others). Trade policy is a fiscal policy as government can use it to control aggregate demand by placing embargo on the importation of certain products to reduce the demand of such products in the local economy.
Yes. Now it is always tricky to do something right when everyone else is thinking at the opposite side. There will be times when you are asked to conform to everyone's decision however you know deep in your heart it is not the right thing to do. So do whatever your heart tells you.
