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exis [7]
2 years ago
11

Suppose that a financial crisis decreases investment spending by $100 billion and the marginal propensity to consume is 0.80. As

suming no taxes and no trade, by how much will real GDP change
Business
1 answer:
erastovalidia [21]2 years ago
6 0

As a result of the decrease in investment spending, the real GDP will change by -$500 billion.

<h3>How much will real GDP change by?</h3>

The decrease will depend on the multiplier which is found as:

= 1 / ( 1 - Marginal propensity to consume)

= 1 / (1 - 0.8)

= 1 / 0.2

= 5

The change will be:

= Decrease in spending x multiplier

= - 100 x 5

= -$500 billion

In conclusion, real GDP will decrease by $500 billion.

Find out more on Marginal propensity to consume at brainly.com/question/17930875.

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The front matter of a formal report refers to the preliminary sections before the body section. True False
Agata [3.3K]

Answer:

TRUE

Explanation:

Front matters are pages of a report that preceeds the first text. It is the first section of a book or report and it's usually the shortest.

It is also known as PRELIMINARY MATTERS or for short PRELIMS.

It comes in different forms. It can be as simple and short as just maybe a single title page or it can include multiple titles pages, abstract, preface amongst others.

3 0
3 years ago
You are considering an investment in a startup that will cost $100,000 but you will receive a cash inflow of $25,000 every year
bulgar [2K]

Answer:

Simple payback is 4 years

Total discounted Payback is more than the 5 years which is the payback cutoff period.

Explanation:

Payback period is the time period in which the project recovers the initial cost incurred. Lower the payback period the more beneficial will be the project.

Simple payback = $100,000 / $25,000 = 4 years

Discounted Payback

Discounted payback is calculated by using the present value of future cash flows.

Total discounted cash flows = 22935.78 + 21042.0 + 19304.59 + 17710.63 + 16248.28 = 97,241.28

As sum of all cash flows are less than the initial investment so, total discounted Payback is more than the 5 years which is the payback cutoff period.

8 0
3 years ago
Ada signed a simple discount promissory note for $5,500. the discount rate is 12%, and the term of the note is 5 months. what ar
Ivahew [28]
<span>Given that, Promissory note A = 5,500 Discount rate i = 12% i = 12/100 Term n= 5 months we know that, 1 year = 12 months 5 months= 5/12 So we get, A = 5,500 i = 12/100 n= 5/12 To find the ada's proceeds on the loan formula is, Proceeds=A(1+i)^n ........... (1) Put the value of A,i,n in equ (1) Proceeds=5500(1+12/100)^5/12 =5500(1+0.12)^0.417 =5500(1.12)^0.41667 =5500(1.04835) Proceeds=5765.94 Therefore $5765.94 Proceeds on the loan</span>
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3 years ago
Each of the following is an advantage of using cash EXCEPT:
Tcecarenko [31]
C. less painful parting with cash
8 0
3 years ago
Read 2 more answers
Who is responsible for the actual performance of service tests and periodic inspection of fire detection and alarm systems
I am Lyosha [343]

Owner is only responsible.

Owner

  • Owner is the one who owns the business, create business plans , different goals, & mainly ensures that there business would last forever.
  • He is never engaged in day to day activities but always do the proper inspection of all the works in all the departments.
  • Manages the budget, sales forecasting, planning, organizing in all the process they used to work as a leader.

Alarm systems

  • These are the systems who had the automatic sensor for smoke, fire, & other fire related emergency are detected.
  • They have different pitch of sounds according to the places; i.e. at required place they have high sound and vice versa.
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learn more about this here-

brainly.com/question/20595654

#SPJ4  

4 0
2 years ago
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