Answer:
Consider the following misperceptions model of the economy. AD: Y =600 + 10(M/P) SRAS: Y=Y +P - pe Okun's Law: (Y - Ý )/Y = - 2ệu - 4) Let 7 =750, ū=0.05, M =600, and pe =40. a. b. What is the price level? (2%) Suppose there is an unanticipated increase in the nominal money supply to 800. What is the short-run equilibrium level of output, the unemployment rate, and the price level? (3%) When price expectations adjust fully, what is the price level? (3%) C.
Explanation:
A) from SRAS : Y = 750+P-40
Y = 710+P
From AD: Y = 600+ 10*600/P
Y = 600 + 6000/P
So solving two eqn
710+P = 600+6000/P
110 + P = 6000/P
P* = 40
Y* = 150
b) now M = 800
So new AD :
Y = 600+8000/P
So, as Y = 710+P
So at eqm
710+P = 600+8000/P
110+P = 8000/P
P' = 50
Y' = 710+50 = 760
from Okun law
(760-750)/750 = -2(u - .05)
1/75 = -2u + .1
2u = .0867
u = .0433
c) when price expectations adjust,then
Y = Y_bar = 750 : potential GDP
SRAS shifts upwards
So from AD:
750=600+10*800/P
P = 800/15
= 53.33
Answer:
To minimize risk, investors should investigate the market and diversify its portfolio.
Interest that builds on the principle and the interest already gained is compound interest
Money invested in a CD
always have a fixed rate of return and is less risky than money used to purchase a home.
Answer:
C) $130,000
Explanation:
Based on the lower of cost or market rule, the valued of the inventory would be
Replacement cost = $130,000
Selling price = $150,000 - $150,000 × 10% = $135,000
After considering the normal gross profit ratio, the value would be
= $135,000 - $150,000 × 20%
= $105,000
If we compare the cost and replacement value, then the less value would be considered i.e $130,000
Answer:C. A mistake of value support the cancellation of a contract.
Explanation:
The law of equity says ' he who comes to equity must come with a clean hand. Although the law requires the enforcement of a valid contract but the precensce of a substantial mathematics mistakes make the contract unenforceable.
It's not a bilateral mistake because it's from one the parties, though not all unilateral mistakes can cancel a contract especially when done with negligence.
The contract been below the price of contract of similar nature is not a valid excuse for non performance after agreement.
Answer:
E. have a strong background in financial management.
Explanation:
Since in the question it is mentioned that (SRW) which is a regional accounting firm that offers services like auditing, accounting, and consultancy. But there are gaps in the information that are not solved by the firm also it violates the Sarbanes-Oxley Act.
Now to be successful there should be a strong background in the financial management
Hence, the option E is correct
