Answer:
The manufacturing overhead applied to work in process is:
D. $79,000
Explanation:
a) Data and Calculations:
Beginning work in process inventory 30,000
Direct materials used in production 50,000
Direct labor 60,000
Total manufacturing costs to account for 219,000
Manufacturing overhead applied to WIP 79,000 (219,000 - 140,000)
Ending work in process inventory 72,000
b) The manufacturing overhead applied to Work in Process is the difference between the total manufacturing costs to account for and the costs of beginning work in process, direct materials, and direct labor for the period. When the ending work in process is deducted from the total manufacturing costs, the resulting figure represents the cost of goods transferred to finished goods inventory.
Consider the following project network and activity times (in weeks): Activity A B C D E F G H Time 5 3 7 6 7 3 10 8 How much time will be needed to complete this project
Answer:
Please find the attached file of the complete question:
Explanation:
Please find the attached file of the solution:
Critical Path: ACH
Duration: 21
Because C is on the Critical Path, it cannot be postponed without causing the project to be delayed.
E is not on the critical path, thus it may also be delayed by two weeks without causing the project to be delayed.
[tex]D : ES : 6, EF : 10, LS : 7, LF : 11[/tex]
Redbud Company uses a certain part in its manufacturing process that it buys from an outside supplier for $44 per part plus another $6 for shipping and other purchasing-related costs. The company will need 10,000 of these parts in the next year and is considering making the part internally. After performing a capacity analysis, Redbud determined that it has sufficient unused capacity to manufacture the 10,000 parts but would need to hire a manager at an annual salary of $40,000 to oversee this production activity. Estimated production costs are determined to be:
Direct material $ 28
Direct labor 12
Variable overhead 6
Fixed overhead (includes manager at $4 per unit) 10
Total unit cost $ 56
A) Identify the relevant costs to make this part internally. (Select all that apply)
A) Historical cost
B) Direct labor
C) Direct material
D) Variable overhead
E) Fixed overhead
F) New manager's salary
B) Should Redbud produce the part or continue to buy it from the outside supplier? (Select the right answer)
A) Redbud should produce the part.
B) Redbud is indifferent about the decision.
C) Redbud should continue to buy it from the outside supplier.
C.What are the other factors that Redbud Company should consider in deciding to make the part internally? (Select all that apply.)
A) Total sales quantity.
B) The potential for improved control over the availability of the parts by having it when needed and the potential for improved quality of the parts.
C) Since Redbud Company is considering the use of currently available capacity, it should evaluate any relevant opportunity costs of using this capacity for more profitable activities.
Answer:
Redbud Company
A) Relevant costs:
B) Direct labor
C) Direct material
D) Variable overhead
F) New manager's salary
B) B) Redbud is indifferent about the decision.
C. Other factors to consider:
B) The potential for improved control over the availability of the parts by having it when needed and the potential for improved quality of the parts.
C) Since Redbud Company is considering the use of currently available capacity, it should evaluate any relevant opportunity costs of using this capacity for more profitable activities.
Explanation:
a) Data and Calculations:
Cost of buying parts from outside supplier = $50 per part
Units required in the next year = 10,000
Costs required to produce internally:
Supervisor's salaries $40,000
Direct material $ 28
Direct labor 12
Variable overhead 6
Fixed overhead (includes
manager at $4 per unit) 10
Total unit cost $ 56
Relevant costs:
Direct material $ 28
Direct labor 12
Variable overhead 6
Fixed overhead (includes
manager at $4 per unit) 4
Total unit cost $50
Volga Co. included a foreign subsidiary in its Year 6 consolidated financial statements. The subsidiary was acquired in Year 4 and was excluded from previous consolidations. The change was caused by the elimination of foreign currency controls. Including the subsidiary in the Year 6 consolidated financial statements results in an accounting change that should be reported:________.
Answer:
By retrospective application to the financial statements of all prior periods presented.
Explanation:
From the question we are informed about Volga Co. who included a foreign subsidiary in its Year 6 consolidated financial statements. The subsidiary was acquired in Year 4 and was excluded from previous consolidations. The change was caused by the elimination of foreign currency controls. Including the subsidiary in the Year 6 consolidated financial statements results in an accounting change that should be reported By retrospective application to the financial statements of all prior periods presented.
Consolidated financial statements can be regarded as financial statements of a particular group whereby equity, assets as well as liabilities and cash flows and expenses of the parent company as well as its subsidiaries are been presented in a way of single economic entity. In others words Consolidated financial statements can as well be regarded as financial statements of an organization having multiple divisions or multiple subsidiaries. Some firms often use the consolidated as regards financial statement reporting to describe aggregated reporting of business collectively.
University Car Wash built a deluxe car wash across the street from campus. The new machines cost $270,000 including installation. The company estimates that the equipment will have a residual value of $24,000. University Car Wash also estimates it will use the machine for six years or about 12,000 total hours. Actual use per year was as follows: Year Hours Used 1 3,100 2 1,100 3 1,200 4 2,800 5 2,600 6 1,200 2. Prepare a depreciation schedule for six years using the double-declining-balance method.
Answer:
Year Depreciation expenses
1 $90,000
2 $60,000
3 $40,000
4 $26,667
5 $17,778
6 $11,556
Explanation:
Note: See the attached excel file for the depreciation schedule for six years using the double-declining-balance method.
The double-declining-balance method is a depreciation approach in which the rate of depreciation for an asset is twice the rate of depreciation for the straight line method.
In the attached excel, the double-declining-balance depreciation rate is therefore calculated as follows:
Straight line depreciation rate = 1 / Number of expected useful years = 1 / 6 = 0.166666666666667 = 16.6666666666667%
Double-declining depreciation rate = Straight line depreciation rate * 2 = 16.6666666666667% *2 = 33.3333333333334%
Also note the following in the attached excel file:
Beginning depreciable amount in Year 1 = Cost of the new machine = $270,000
The depreciation expenses for Year 6 is calculated by deducting the residual value of $24,000 from Year 6 Beginning depreciable amount. That is:
Depreciation expenses for Year 6 = $35,556 - $24,000 = $11,556
The residual value of $24,000 therefore represents the book value at the end of Year 6.
From the attached excel file, we therefore have:
Year Depreciation expenses
1 $90,000
2 $60,000
3 $40,000
4 $26,667
5 $17,778
6 $11,556
Record the journal entry for Sales and for Cash Over and Short for each of the following separate situations.a. The cash registerâs record shows $420 of cash sales, but the count of cash in the register is $430.b. The cash registerâs record shows $980 of cash sales, but the count of cash in the register is $972.
Answer and Explanation:
The journal entry is shown below:
Cash $430
To Sales revenue $420
To Cash over and short $10
(Being cash is recorded)
Here cash is debited as it increased the assets and credited the sales as it also increased the revenue
Cash $972
Cash over and short $8
To Sales revenue $980
(being cash is recorded)
Here cash is debited as it increased the assets and credited the sales as it also increased the revenue
Hãy chỉ rõ điểm giống nhau và khác nhau về vấn đề sau đây: Giá trị, giá thành, giá trị cá biệt, giá trị xã hội, giá cả thị trường
XYZ Corporation produces and sells 10,000 units of Product X each month. The selling price is $40 per unit, and variable expenses are $32 per unit. A study has been made concerning whether Product X should be discontinued. The study shows that $70,000 of the $120,000 in monthly fixed expenses charged to Product X would not be avoidable even if the product was discontinued. If Product X is discontinued, the annual financial advantage (disadvantage) for the company of eliminating this product should be: Group of answer choices
Answer:
If the company discontinues Product X, income will decrease by $30,000.
Explanation:
Giving the following information:
Sales= 10,000*40= $400,000
Total variable expense= 32*10,000= 320,000
Avoidable fixed costs= $50,0000
To calculate the effect on the income of discontinuing Product X, we need to use the following formula:
Effect on income= avoidable fixed cost - total contribution margin
Effect on income= 50,000 - (400,000 - 320,000)
Effect on income= $30,000 decrease
If the company discontinues Product X, income will decrease by $30,000.
Generally Accepted Accounting Principles (GAAP), the accounting rule book. In the following scenario, please indicate which GAAP rule is being violated and why. Follow up with comments about why you think the rule exits and is important.
Scenario: XYZ Inc. was in the process of preparing its financial statements. XYZ is hoping to get approved for a loan from the First National Big Bank. XYZ's sole shareholder Slick, notices that the cash listed on the balance sheet is $4,000. Slick suggests that the balance sheet should include his personal current cash balance of $100,000. Slick convinces the company accountant to change cash on XYZ's balance sheet to $104,000. After all, he would gladly put his personal cash in if needed.
Answer: Business Entity Concept
Explanation:
The Business entity concept posits that the owners of a business and the business itself, are different entities. This means that transactions involving the two are not to be mixed up but are to be recorded separately.
The reason this concept exists is to ensure that a business is analyzed and treated on its on merit and not that of its owner because the owner might be successful and the business isn't. The reverse is also true.
XYZ Inc violates this concept here by mixing the accounts of the owner and the business in order to influence a loan decision. This goes against accounting concepts and gave the company an incorrect valuation.
A newscaster earns $26600 and wants to invest 10% of his/her monthly salary to save for retirement in 28 years. if he/she invests this money at 4.2% compounded monthly, how much money will he/she have at retirement?
a) How much will be saved each year?
b) What will be the monthly deposit?
c) What will be the amount in the account after 28 years?
Answer:
Results are below.
Explanation:
Giving the following information:
Annual salary= $26,600
Number of periods= 28*12= 336
Interest rate= 0.042/12= 0.0035
First, we need to calculate the annual savings:
Annual saving= 26,600*0.1= $2,660
Now, the monthly deposit:
Monthly deposit= 2,660/12= $221.67
Finally, the future value of the investment:
FV= {A*[(1+i)^n-1]}/i
A= monthly deposit
FV= {221.67*[(1.0035^336) - 1]} / 0.0035
FV= $141,535.3
When a company assigns the costs of direct materials, direct labor, and both variable and fixed manufacturing overhead to products that company is using
Answer: Absorption costing
Explanation:
Absorption costing believes that all costs that went into the production of a good or service should be absorbed by/ apportioned to those same goods and services regardless of if the costs are direct or indirect.
It works by first assigning the direct costs such as labor and material and then it apportions the indirect costs such as the variable and fixed manufacturing overhead costs. Absorption costing is the preferred costing method for presenting financial statements outside the company by both IFRS and U.S. GAAP.
Fern, Inc., Ivy, Inc., and Jeremy formed a general partnership. Fern owns a 50% interest, and Ivy and Jeremy both own 25% interests. Fern, Inc. files its tax return on an October 31 year-end; Ivy, Inc., files with a May 31 year-end, and Jeremy is a calendar year taxpayer. Which of the following statements is true regarding the taxable year the partnership can choose?
A) The partnership must choose the calendar year because it has no principal partners.
B) The partnership must choose an October year-end because Fern, Inc., is a principal partner.
C) The partnership can request permission from the IRS to use a January 31 fiscal year under § 444.
D) The partnership must use the "least aggregate deferral" method to determine its "required" taxable year.
E) None of the above items are true.
Answer: D) The partnership must use the "least aggregate deferral" method to determine its "required" taxable year.
Explanation:
The Least Aggregate Deferral rule is used when neither of the partners can enforce their taxable year on the others because there is no dominant partner as is the case here because no shareholder has more than 50% ownership and the tax years of the partners are not aligned.
The partnership will have to use the "Least Aggregate Deferral" method when the above happens which is based on the percentage of profits for each partner.
Consider the markets for tap water, bottled water, cola, and beer. Assume there is only one provider of tap water, bottled water manufacturers use advertising to differentiate their products, cola producers engage in strategic pricing behavior, and the beer market is largely controlled by only a few firms. Classify the market for each of the following drinks as either monopoly, oligopoly, monopolistic competition, or perfect competition.
Monopoly Oligopoly Monopolistic Competition Perfect Competition
Tap water
Bottled water
Cola
Beer
Answer:
Tap water ⇒ Monopoly
In a monopoly, there is only one supplier of a certain good or service. Tap water is therefore a monopoly as only one provider supplies it.
Bottle water ⇒ Monopolistic competition
In a monopolistic competition, similar but differentiated products are supplied. As bottled water is differentiated by advertising, it must exist in a monopolistic competition.
Cola ⇒ Oligopoly
An oligopoly is controlled by a few firms who have to engage in strategic planning behavior in order to sell their goods. This means that they would either lower prices to match competitors or collude with them to ensure stable prices.
Beer ⇒ Oligopoly
In an oligopoly, the market is controlled by a few firms who have an incentive to collude to set a certain price because a price war would be bad for all the firms involved.
Retained earnings, December 31, 2012 $311,900 Â
Cost of equipment purchased during 2013 30,000 Â
Net loss for the year ended December 31, 2013 4,550 Â
Dividends declared and paid in 2013 15,200 Â
Decrease in cash balance from January 1, 2013, to December 31, 2013 12,800 Â
Decrease in long-term debt in 2013 15,900 Â
Required:
From the above data, calculate the retained earnings balance as of December 31, 2013. (Negative amounts should be indicated by a minus sign.)
Answer:
Retained earnings balance as of December 31, 2013
Particulars Amount ($)
Retained Earnings Dec 31, 2012 311,900
Less: Net Loss for the Year 4,550
Less: Dividend declared and paid in 2013 15,200
Retained Earnings Dec 31, 2013 $292,150
today, many long-term care policies are treated as tax-qualified contracts. Which of the following is not correct regarding tax-qualified long-term care contracts?
A. Tax-qualified long-term care policies must provide benefits that are limited to long-term care services.
B. These policies can be provided under an employer sponsored cafeteria plan.
C. These policies allow employers to provide this benefit, take a curent income tax deduction and allow the employee to avoid income inclusion.
D. The premiums for these policies may be deductible either above the line or below line.
Answer:
C. These policies allow employers to provide this benefit, take a current income tax deduction and allow the employee to avoid income inclusion.
Explanation:
Tax qualified long term care contracts usually insurance policies which provide benefit to the company and policy amounts can be deducted from the tax. These benefits are limited to the long term care services. The premium amount of these policies is deductible which provide tax benefit.
Your firm uses half debt and half equity. The shareholders need to earn 20%. The firm can borrow at 5%. The risk free rate is 2%. The tax rate is 40%. Find the weighted average cost of capital.
Answer:
11.5%
Explanation:
WACC = weight of equity x cost of equity + weight of debt x cost of debt x (1 - tax rate)
On June 10, Pais Company purchased $9,000 of merchandise from MacGyver Company, on account, terms 3/10, n/30. Pais pays the freight costs of $400 on June 11. Goods totaling $600 are returned to MacGyver for credit on June 12. On June 19, Pais Company pays McGiver Company in full, less the purchase discount. Both companies use a perpetual inventory system. Journalize perpetual inventory entries. Instructions a. Prepare separate entries for each transaction on the books of Pais Company. b. Prepare separate entries for each transaction for MacGyver Company. The merchandise purchased by Pais on June 10 cost MacGyver $5,000, and the goods returned cost McGiver $310.
Solution :
Pais Company
June 10 Inventory 9000
Accounts payable 9000
June 11 Inventory 400
Cash 400
No entry 0
June 12 Accounts payable 600
Inventory 600
June 19 Accounts payable 8400
Inventory 252 = 8400 x 3%
Cash 8148
McGiver Company
June 10 Accounts Receivable 9000
Sales revenue 9000
Cost of goods sold 5000
Inventory 5000
June 12 Sales return and allowances 600
Accounts receivable 600
Inventory 310
Cost of goods 310
June 19 Cash 8148
Sales discount 252 =8400 x 3%
Account receivable 8400
MC Qu. 114 Lowden Company has an overhead application... Lowden Company has an overhead application rate of 155% and allocates overhead based on direct material cost. During the current period, direct labor cost is $60,000 and direct materials used cost $90,000. Determine the amount of overhead Lowden Company should record in the current period.
Answer:
the overhead amount recorded is $139,500
Explanation:
The computation of the overhead amount recorded is shown below:
= Overhead application rate × direct material cost
= 155% × $90,000
= $139,500
Hence, the overhead amount recorded is $139,500
We simply applied the above formula so that the correct value could come
You invested $5,000 in the stock market one year ago. Today, the investment is valued at $5,500. What return did you earn? What return would you suffer next year for your investment to be valued at the original $5,000?A. 10%, -9.09%, respectivelyB. -10%, +9.09%, respectivelyC. 110%, -10%, respectivelyD. 110%, -9.09%, respectively
Answer:
A
Explanation:
Rate of return in one period = (value in year 1 / initial value) - 1
(5500 / 5000) - 1 = 0.1 = 10%
(5000 / 5500) - 1 = -9.09%
Situation 1: There is a Head of Human Resource (HR) in a recognized Multinational National Company (MNC). You are a marketing executive in that company. You have made a communication with the HR regarding an emergency short time leave in a Critical moment of the Company’s turnover.
In this case how you will communicate with him and convince him to provide you a short-term leave. The things to be aware of.
1. HR is a rudy person.
2. He isn't very familiar with you.
3. Company is now at a Critical Moment and there is a lot of turnovers.
4. HR is about the age of 45+
And also provide an alternative answer if the situation gets negative over you.
Ans.
Answer:
As a marketing executive of the company looking to beg an emergency leave from a HR person who is considered to be rudy, unfamiliar with me, 45+ age and also that the company is experiencing a lot of turnovers, the best way to approach the HR would be to:
1. Write an official letter to him making the intentions clear.
2. Politely ask him to consider your request even though you two are not very familiar with each other.
3. Stress the importance of the emergency and why you have to leave.
Suppose the black market shrinks because firms shift to the formal sector, but production remains the same. GDP
Answer: will increase but this will not affect living standards
Explanation:
GDP is sometimes called an incomplete measure because there are certain measures that it does not include such as the black market.
If firms in the black market shift to the formal sector, they will now be included in GDP which means that GDP will increase.
The living standards of people in the country will probably not change however because the firms involved were simply shifting sectors and are not said to be more or less prosperous as a result. Assuming they remained the same, nothing changes for living standards.
Bonita Industries constructed a building at a cost of $14400000. Weighted-average accumulated expenditures were $5620000, actual interest was $566000, and avoidable interest was $272000. If the salvage value is $1120000, and the useful life is 40 years, depreciation expense for the first full year using the straight-line method is
Answer:
$338,800
Explanation:
Cost of the building = $14400000
Average accumulated expenditures = $5620000
Actual interest = $566000
Avoidable interest = $272000
Salvage value = $1120000
Useful life = 40 years
Depreciation expense for the first full year:
= ((Cost of the building + Avoidable interest) - Salvage value) / Useful life
= (($14400000 + $272000) - $1120000) / 40
= ($14672000 - $1120000) / 40
= $13552000 / 40
= $338,800
Which of the following describes the tax advantage of a qualified retirement plan
Answer:
Qualified retirement plans give employers a tax break for the contributions they make for their employees. Those plans that allow employees to defer a portion of their salaries into the plan can also reduce employees' present income-tax liability by reducing taxable income.
Provides a way to accumulate substantial retirement income.
Those are some reasons, hope they helped!!
Explanation:
Calculate the activity rate per grooming order. $fill in the blank 1 per grooming order 2. Calculate, in terms of grooming orders, the: a. Total activity availability fill in the blank 2 grooming orders b. Unused capacity fill in the blank 3 grooming orders 3. Calculate the dollar cost of: a. Total activity availability $fill in the blank 4 b. Unused capacity
Solution :
1. calculate the activity rate per grooming order
Activity rate Amount paid to agent
Number of grooming order
28,000
4,000
Therefore, the activity rate = 7 per grooming order
2. Calculating, in terms of grooming order, the :
a. Total activity availability
Number of grooming orders (A) = 4,000
Number of agents (B) 5
Total activity availability (A x B) 20,000
b). Total activity availability 20,000
Less: Orders actually processed (17,800)
Unused capacity 2,200
3. calculating the dollar cost of :
a). Amount paid to the agent (A 28,000
Number of agents (B) 5
Total activity availability in dollars (AxB) 140,000
b). Unused capacity (A) 2,200
Activity rate (B) 7
Unused capacity in dollars (AxB) 15,400
XYZ Corporation manufactures air conditioners and has the capacity to manufacture and sell 80,000 units each year. It is currently only manufacturing and selling 60,000 units. The following per unit numbers relate to annual operations at 60,000 units: Per Unit Selling price $ 125 Manufacturing costs: Variable $ 25 Fixed $ 40 Selling and administrative costs: Variable $ 10 Fixed $ 15 A customer would like to purchase 3,000 air conditioners from XYZ but only if they can get them for $75 each. Variable selling and administrative costs on this special order will drop down to $2 per unit. This special order will not affect the 60,000 regular sales and it will not affect the total fixed costs. The annual financial advantage (disadvantage) for the company as a result of accepting this special order from this customer should be:
Answer:
The annual financial advantage is $147000
Explanation:
Firm A is planning on merging with Firm B. Firm A will pay Firm B's stockholders the current value of their stock plus $120, which equals one-half of the synergy, in shares of Firm A. Firm A currently has 4,000 shares of stock outstanding at a market price of $21 a share. Firm B has 1,200 shares outstanding at a price of $10 a share. What is the value of the merged firm
Answer:
2000 I think if not sorry dont rk
According to the condition, the value of the merged firm is $96240. Thus, the correct option is (A).
A merger is a corporate transaction in which two existing, separate firms unite to establish a new, single legal company. Mergers are completely elective.
Typically, both organizations are of comparable size and scope, and both stand to benefit from the deal.
Here,
Calculate the value of the firm as follows:
Firm A = 4000 x 21 = $84000
Firm B = 1200 x 10 = $12000
Firm C = 120+120 = $240
Calculate the value of the merged firm as follows:
Value of merged firm = $84000 + $12000 + $240 = $96240
Therefore, the correct option is "A".
To know more about the merged firm, visit:
https://brainly.com/question/34054239
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This is an incomplete question, the complete question is:
Firm A is planning on merging with Firm B. Firm A will pay Firm B's stockholders the current value of their stock plus $120, which equals one-half of the synergy, in shares of Firm A. Firm A currently has 4,000 shares of stock outstanding at a market price of $21 a share. Firm B has 1,200 shares outstanding at a price of $10 a share. What is the value of the merged firm?
A. $96,240
B. $96,000
C. $92,360
D. $88,120
E. $84,120
Based on an examination of the risk and return data for a variety of alternative investments during the period of 1926-2011, which of the following statements is correct? Over the period of 1926-2011, the general trend of increasing riskiness among the following five assets is: U.S. Treasury bills, U.S. government long-term government bonds, long-term corporate bonds, large-company stocks, and small-company stocks. Over the period of 1926-2011, the general trend of increasing return among the following five assets is: U.S. Treasury bills, long-term corporate bonds, U.S. government long-term bonds, large-company stocks, and small-company stocks. Large-company stocks, rather than small-company stocks, exhibit the greater risk and the greater return. Small-company stocks, rather than long-term corporate bonds, exhibit both the greater return and the greater standard deviation.
Answer:
Based on an examination of the risk and return data for a variety of alternative investments during the period of 1926-2011, the correct statement is:
Small-company stocks, rather than long-term corporate bonds, exhibit both the greater return and the greater standard deviation.
Explanation:
Small-company stocks are known to show the highest volatility of returns among these five assets. The reason is that investors in small company stocks always expect higher returns to pay for the higher risks involved in such unproven investments, unlike investing in other assets. In addition, small-company stocks are known to pose higher risks given their known failure to deliver on their promised performance and returns.
Microhard has issued a bond with the following
Par
Time to maturity
Coupon rate
Semiannual payments
(Advanced analysis) Answer the question on the basis of the following information for a mixed open economy. The letters Y, Ca, Ig, Xn, G, and T stand for GDP, consumption, gross investment, net exports, government purchases, and net taxes respectively. Figures are in billions of dollars. Refer to the information. If government desired to raise the equilibrium GDP to $650, it could:
Answer:
The correct option is c. raise G by $30 or reduce T by $40.
Explanation:
Note: This question is not complete. The complete question is therefore provided before answering the question as follows:
(Advanced analysis) Answer the question on the basis of the following information for a mixed open economy. The letters Y, Ca, Ig, Xn, G, and T stand for GDP, consumption, gross investment, net exports, government purchases, and net taxes respectively. Figures are in billions of dollars.
Ca = 25 + 0.75(Y - T)
Ig = Ig0 = 50
Xn = Xn0 = 10
G = G0 = 70
T = T0 = 30
Refer to the information. If government desired to raise the equilibrium GDP to $650, it could:
a. raise G by $45 or reduce T by $10.
b. raise G by $40 and reduce T by $30.
c. raise G by $30 or reduce T by $40.
d. raise both and T by $40.
e. reduce G by $30 and increase T by $40.
The explanation of the answer is now provided as follows:
Equilibrium GDP (Y) can be obtained as follows:
Y = C + G + I + Xn …………………….. (1)
Substituting all the values in the question into equation (1) and solve for Y, we have:
Y = 25 + 0.75(Y - 30) + 70 + 50 + 10
Y = 0.75Y - 22.50 + 155
Y – 0.75Y = 132.50
0.25Y = 132.50
Y = 132.50 / 0.25
Y = 530
Therefore, we have:
Y = Current equilibrium GDP = $530
Amount of increase in equilibrium GDP required = Desired equilibrium GDP – Current equilibrium GDP = 650 - 530 = 120
From the question, we have:
Ca = 25 + 0.75(Y - T) ………………. (2)
The 0.75 in equation (2) is the marginal propensity to consume (MPC). Therefore, we have:
MPC = 0.75
Expenditure multiplier = 1 / (1 - 0.75) = 4
Tax multiplier = - MPC / (1 – MPC) = -0.75 / (1 – 0.75) = -3
Amount of increase in G or government expenditure required = Amount of increase in equilibrium GDP required / Expenditure multiplier = 120 / 4 = $30
Amount of tax cut or decrease in T required = Amount of increase in equilibrium GDP required / Tax multiplier = 120 / (-3) = -$40
Therefore, correct option is c. raise G by $30 or reduce T by $40.
If the demand for a product was 16, 28, 20 and 24 units in four consecutive months, and the corresponding forecasts in those four months were 20, 16, 20 and 30 units respectively, what is the MAD at the end of four months
Answer:
5.5 units
Explanation:
Period Actual Forecast Absolute deviation
1 16 20 4
2 28 16 12
3 20 20 0
4 24 30 6
Total 22
Mean absolute deviation(MAD) = Sum of absolute deviation / Number of periods
Mean absolute deviation(MAD) = 22 / 4
Mean absolute deviation(MAD) = 5.5 units
Deluxe Company expects to pay a dividend of $2 per share at the end of year-1, $3 per share at the end of year-2 and then be sold for $32 per share. If the required rate on the stock is 15%, what is the current value of the stock
Answer:
i need this too just like you
