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FrozenT [24]
1 year ago
5

William McChesney Martin, who served as Chairman of the Federal Reserve in the 1950s and 1960s, is famous for saying that centra

l banks should "take away the punch bowl just as the party is heating up".
What does this saying mean? Why wouldn't we want the "party" to get too exciting? What are the potential impacts of adding too much fuel to the economy?
Business
1 answer:
laiz [17]1 year ago
3 0

Answer:

PART A

The saying means that it should remove the economic incentives when it has reached its peak in order to prevent it from impacting negatively on the economy.

PART B

(1) It can lead to Inflation.

(2) it can lead to reduced Productivity within the economy.

Explanation:Central banks all over the world are known to put incentives and Stimulus factors in place in order to help improve, resuscitate or sustain the economy in terms of crisis, but the impacts of the Incentives or Stimulus programs of the central banks can lead to certain negative consequences if not effectively monitored or removed when necessary.

SOME OF THE NEGATIVE CONSEQUENCES WHICH CAN ARISE IF THE INCENTIVES OR STIMULUS PROGRAMS USED TO SUSTAIN THE ECONOMY ARE NIT REMOVED EXAMPLES INCLUDE IT CAN LEAD TO INFLATION,IT CAN LEAD TO REDUCTION IN THE OVERALL PRODUCTIVITY WITHIN THE ECONOMY ETC.

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A company is evaluating an investment which has an initial investment of $4,000. Annual net cash flows is expected to be $2,000
uysha [10]

Answer:

The NPV of the project is $974.

Explanation:

The net present value is the today's value of a stream of cash flows. The net present value will be the sum of all the expected future cash flows from a project less the initial investment required for the project and it is used to evaluate the investment decisions.

The net present value of an investment project will be:

NPV = CF1 / (1+r) + CF2 / (1+r)^2 + ... + CFn / (1+r)^n - Initial investment

or

If the cash flows are constant or of same amount through out, occur after the same interval of time and are for a defined period of time, they become an annuity and the NPV of such a project can be calculated by,

NPV = (Cash flow per period * Present value of Annuity factor) - Initial cost

The NPV of this project will be = (2000 * 2.4869) - 4000 = 973.8 rounded off to $974

4 0
1 year ago
Scenario 34-2. The following facts apply to a small, imaginary economy. • Consumption spending is $6,720 when income is $8,000.
Temka [501]

Answer:

0.64

Explanation:

Marginal propensity to consume is given by the ratio of the change in consumption spending to the change in income.

In this scenario, the change in consumption spending is:

\Delta CS = \$7,040-\$6,720\\\Delta CS = \$320

The change in income is:

\Delta I = \$8,500-\$8,000\\\Delta CS = \$500

The marginal propensity to consume for this economy is:

MPC=\frac{\Delta CS}{\Delta I}=\frac{\$320}{\$500} \\MPC =0.64

The answer is 0.64.

3 0
1 year ago
Darcy is a new manager in a large consulting firm. As one of her first tasks, she needs to set goals for her team. Her team is g
Soloha48 [4]

Complete Question:

Darcy is a new manager in a large consulting firm. As one of her first tasks, she needs to set goals for her team. Her team is global and the members operate on their own, serving a variety of client needs in different industries and market sectors. What method will Darcy likely choose to set goals?

A. Top-down.

B. Bottom-up.

C. Road mapping.

D. Focus groups.

Answer:

Bottom-Up method will Darcy likely choose to set goals

Explanation:

With the bottom up strategy, the team members build their own goals. When this is completed, it is up to you to merge all these tasks into a single group of targets.

When completed, you will have to merge these different goals into a single team set of targets. This can be a problem for any boss, as you may well understand.

Many forms of team members are well adapted for the bottom-up approach of setting goals. In particular team members who decide their own tasks, who understand the company's priorities and strategies and understand the role of the organisation in achieving these objectives.

4 0
2 years ago
If STUDENT and COURSE participate in a relationship, this is an example of a(n):
Svet_ta [14]

If student and course participate, that relationship is called a Binary Relationship

Explanation:

Binary Entity:

it can be defined as the relationship between 2 different entities.

The binary entity is of 3 types namely

  • one to one (eg: person and diving license)
  • one to many ( eg: project and employee )
  • many to many (eg: student and books)

The binary  of teacher and subject can be explained by

<em>teacher</em> → teaches → <em>subject</em>

6 0
1 year ago
A group of ten UIC professors each contributed an equal amount to the purchase of a State of Illinois Lottery ticket. Two of the
Bogdan [553]

Answer:

Total cost of Ticket = $96

Explanation:

Provided information,

Total number of people buying lottery ticket in a joint contribution = 10

Two people withdraw being short of funds, therefore people buying such ticket = 8

Revised share increase by $2.40 each.

Total increase = $2.40 \times 8 = $19.20

Just because 2 people withdraw, thus earlier contribution per person = $19.20/2 = $9.60

Therefore, total cost of ticket = $9.60 \times 10 = $96

3 0
2 years ago
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