Answer:
(a) $15
(b) $35
(c) 4
(d) $80
Explanation:
Given that,
Initial deposit = $20 bill
Required reserve ratio = 25%
(a) Money lend out by bank is as follows:
= Amount of deposit - Reserve requirement
= $20 - ($20 × 0.25)
= $20 - $5
= $15
(b) Money in the economy changed:
= Initial deposit + Amount of money lend out by bank
= $20 + $15
= $35
(c) Money multiplier:
= 1/ Required reserve ratio
= 1/ 0.25
= 4
(d) Money will eventually be created by the banking system:
= Change in deposits × Money multiplier
= $20 × 4
= $80
Answer:
Household and government are related to each other in terms of economic unit. Household pay taxes to government and then government use that money for the people. Household earn the money by working in firms or by running their own business.
Environmental issues such as air pollution can affect the relationship between household and government. Popleuses their own transport to go to firms and the number of vehicles are increasing day by day which causes air pollution.
The government can form policies against personal transport and convince people to use public transport which will be beneficial for government as government will directly get money from household.
Answer:
Total cashflows = $12,555+2.629x
x = $9,488.40
Explanation:
The computation of cash flow must the investment provide at the end of each of the final 4 years, that is, and X is shown below:-
Year Cashflow Present value at 8% Discounted cashflow
1 $2,500 0.926 2,315
2 $5,000 0.857 4,285
3 $7,500 0.794 5,955
4 x 0.735 0.735x
5 x 0.681 0.681x
6 x 0.63 0.630x
7 x 0.583 0.583x
Total cashflows $12,555+2.629x
Therefore,
$12,555 + 2.629x = $37500
2.629x = $37500 - $12555
x = $24945 ÷ 2.629
x = $24945 ÷ 2.629
x = $9,488.40
Answer:
This implies Bolster Soda collects receivables more effectively and quickly than Castor Soda in the two years.
Explanation:
The accounts receivable turnover ratio refers to an accounting ratio that is used to show the how effective a firm is in collecting the receivables or money its clients are owing it.
This implies that accounts receivable turnover ratio is used to determine the extent to which a firm ie effectively managing the credit it gives to customers and how quickly the firm collects that that short-term debt.
The formula for calculating the accounts receivable turnover ratio is as follows:
Accounts receivable turnover ratio = Net credit sales / Average accounts receivable
When the accounts receivable turnover ratio is high, it implies that the company is efficient is collecting debt and a high percentage of its cutomers are paying up their debts.
The account receivable turnover ratios in the question therefore imply Bolster Soda collects receivables more effectively and quickly than Castor Soda in the two years.
Answer:
The correct answer is:
-$80 (d.)
Explanation:
in order to calculate this, we have to determine the total income earned from farming, and the total income that could have been earned if Ziva had done her consultancy service, and calculate the difference. This is shown as follows:
farming business
cost of seeds = $130
income from seeds = $300
Net income from farming = 300 - 130 = $170
Home-organizing service
charge per hour = $25
time spent on field that would have been used for consultancy = 10 hours
total amount that would have been earned for consultancy = 25 × 10 = $250
Difference between income earned for farming and the income that would have been earned for home-organizing serving = 170 - 250 = -$80
Note that the negative sign is there because Ziva indulged in the activity with the lesser income so she effectively made an economic loss instead of a profit (she made a negative profit).
