Answer:
Under a) r=0.1;Id=50;Cd=750;P=7 b) P only changes and is now 9.33
Explanation:
a) In a closed economy national savings are equal to investments or:
S d = I d = Y - Cd - G
Id = Y - 100 - 0.8*Y + 500*r - 0.5*G
100 - 500*r = 0.2*Y -100 + 500*r -0.5*G
200 - 1000*r = 0.2*1000 - 0.5*200=100
-1000*r=-100
r= 0.1
i = 0.15
Id = 100 -50 =50
Cd= 100 + 800 - 50 - 100=750
P = Md/Y-2000 i
P= 2100/1000 -300=7
b) If money supply increases to 2800, the price level would be:
P = 2800/Y - 2000*i = 2800/Y- 2000*(i-inflation)
However, since the variables determining real interest rate remained the same, r is also the same or 0.1 and i is 0.15. Consumption and investment remain the same, only price level changes or:
P=9.33
Answer:
It will be a better offer the option B because it yield a higher net present value at the given rate.
<u>B 88,457</u>
A 86,755
C 85,000
Explanation:
We are going to compare the present value of each annuity at the cost of capital rate 7.5%
option A
C= couta, monthly payment 1,500
rate= 0.075 is an annual rate we divide by 12 to get the monthly rate
time = 6 years = 6*12 = 72 months
option A PV = 86,754.78646
option B
C = 1,050
time = 10 years
same rate
option B PV = 88,456.97984
option C = 85,000
It will be a better offer the option B because it yield a higher net present value at the given rate.
Answer:
$985.25
Explanation:
The $51,233 is Dr. McCoy's annual salary; the total amount she earns in a year
We have about 52 weeks in a year
To determine the weekly salary, you will set up the equation like this;
<em>If 52 weeks = $51,233</em>
<em>then 1 week = ?</em>
Multiply 1 by $511,233 ; 1 * 51,233 =$51,233
Next, divide the above $51,233 by 52;
$51,233/ 52 = $985.25
Her weekly salary is therefore $985.25
Given that the marginal cost is $18, and the price per Bushel of $48, the farmer can choose to increase production or not. This is because at this margin, the return on investment will be:
(48-18)/18*100
=166.67%
Which means he'll still be profitable if he chooses to do nothing. The correct answer is:
c. stay at this level of production.
Answer:
BUDGET
Explanation:
Since Bobby wants to set aside money for each of the advertising media based on its relative potential, the component of the advertising plan that would help Bobby allocate money to the different media according to the finances available is budget.
The budget component of the advertising plan is where all costs related to the advertising activity are laid out, stating when they are due and how they will be met
