Answer:
b) there is a real shock instead of an aggregate demand shock.
Explanation:
Fiscal policy is the process of influencing economic activities by way of taxation and government spending.
Fiscal policy is most effective in dealing with deep recession or an economic situation characterised by a consistent fall in gross domestic product(GDP) for over two quarters.
Answer:
Should be done: a counter cyclical or a growth-oriented fiscal policy ,deficit spending and stabilize the aggregate demand.
Explanation:
Keynesian economy is a macroeconomic theory based on the views of the 20th century British economist John Maynard Keynes. Keynes' economy advocates a mixed economy where the private sector is predominant but the state and the public sector play a major role. According to the Keynesian theory, the sum of all the micro-economic behaviors shown by all individuals and businesses results in inefficiency and the economy operates at a level below its potential output and growth. When total demand for products is insufficient, the economy enters a crisis and unnecessary unemployment arises due to defensive behavior of the producers. In such cases, the government may pursue policies to increase aggregate demand, and as a result may accelerate economic activities and reduce unemployment. Most Keynesian propose policies to stabilize the business cycle. For example, if the unemployment level is too high, the state can pursue a growth-oriented monetary policy.
Keynes was thinking of reviving the economy with low interest and state investments as a solution to the Great Depression. The government increases investment income and consequently consumption, resulting in more production and investment, resulting in increased consumption again. The first economic stimulus investment triggers a series of events and the subsequent investment provides a much tougher economic efficiency. According to Keynes, money supply is provided by monetary authority (eg central bank) and monetary policy affects prices. When interest rates fall below this normal rate, investors avoid buying bonds and prefer to hold cash in anticipation of higher rates. When interest rates are above this normal rate, they tend to buy bonds with the expectation that they will fall. Therefore, it can be said that there is a negative relationship between money demand and interest rate.
Answer and Explanation:
According to the given situation, The Strategic Negotiation or Distributive Negotiation is also known as Win-lose strategy, was introduced by Rainbow Paints Inc.
They say they should be liable for the losses, and they will refund the advance payment. Therefore they support a hard-line strategy.
XingPe Chemicals embraces a resolution of the conflict on this subject. So, they are required to handle the part of loss and want to compensate for the remaining loss by a rainbow. They are justifying to wait on pandemic grounds which is a matter of force measure. They do promise to honor all future contracts.
Answer:
$400,000
Explanation:
Data provided in the question:
Development cost incurred = $2,000,000
Amount incurred after the technological feasibility was achieved = $400,000
Now,
The Software development costs that would be capitalized in 20X1
= Cost incurred after achievement of technological feasibility
= $400,000
b. The optional pricing strategy (O.P.)
More about optional pricing:
When a company uses optional product pricing, it sets a base product at a lower cost and additional, optional products at a higher price to make up for any losses. Optional products are not required for the base product to function, but they typically improve the customer experience.
The two key components of optional product pricing:
- A base product is the main draw for the customer or the reason they are purchasing. It meets the needs of the customer and does not require the optional product to function.
- A complimentary product(s): A product that a customer who purchased the base product is likely to purchase in order to improve their experience with the base product.
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