Eggz, Inc., is considering the purchase of new equipment that will allow the company to collect loose hen feathers for sale. The equipment will cost $430,000 and will be eligible for 100 percent bonus depreciation. The equipment can be sold for $48,000 at the end of the project in 5 years. Sales would be $279,000 per year, with annual fixed costs of $48,000 and variable costs equal to 35 percent of sales. The project would require an investment of $27,000 in NWC that would be returned at the end of the project. The tax rate is 21 percent and the required return is 8 percent. Calculate the NPV of this project. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) NPV
Answers
Answer:
NPV = $91,412.60
Explanation:
initial outlay = $430,000 (equipment cost) + $27,000 (increase in net working capital) = $457,000
revenue per year (without considering depreciation) = {[$279,000 x (1 - 35%)] - $48,000} x (1 - 21%) = $105,346.50
additional revenue generated by bonus depreciation = $430,000 x 21% = $90,300
after tax salvage value = $48,000 x (1 . 21%) = $37,920
Cash flow year 0 = -$457,000
Cash flow year 1 = $105,346.50 + $90,300 = $195,646.50
Cash flow year 2 = $105,346.50
Cash flow year 3 = $105,346.50
Cash flow year 4 = $105,346.50
Cash flow year 5 = $105,346.50 + $37,920 + $27,000 = $170,266.50
discount rate = 8%
using a financial calculator, NPV = $91,412.60
Related Questions
Puri Corporation uses the FIFO method in its process costing system. Data concerning the first processing department for the most recent month are listed below:
Beginning work in process inventory:
Units in beginning work in process inventory 400
Materials costs $4,800
Conversion costs $3,300
Percent complete with respect to materials 85 %
Percent complete with respect to conversion 45 %
Units started into production during the month 5,800
Units transferred to the next department during
the month 5,100
Materials costs added during the month $69,500
Conversion costs added during the month $82,300
Ending work in process inventory:
Units in ending work in process inventory 1,100
Percent complete with respect to materials 55 %
Percent complete with respect to conversion 45 %
The cost per equivalent unit for conversion costs for the first department for the month is closest to:_______.
Answers
Answer:
$15.20
Explanation:
Computation for the cost per equivalent unit for conversion costs for the first department
First step
FIFO METHOD
IN
Beginning WIP 400
Units Introduced 5800
Total 6,200
OUT
Beginning WIP Completed 400
Production started and Completed 4,700
(5800-1100)
Ending WIP 1100
Total 6,200
Equivalent Units
Materials
% Complete Equivalent unit
Beg. WIP Completed 400 15% 60
(15%*400=60)
Production started and Completed 4,700 (5800-1100) 100% 4,700
(100%*4,700=4,700)
Ending WIP 1,100 55% 605
(55%*1,100=605)
TOTAL 5,365
(60+4700+605)
Equivalent Units
Conversion
% Complete Equivalent unit
Beg. WIP Completed 400 55% 220
(55%*400=220)
Production started and Completed 4,700 (5800-1100) 100% 4,700
(100%*4,700=4,700)
Ending WIP 1,100 45% 495
(45%*1,100=495)
TOTAL 5,415
(220+4700+495)
Second step is to Compute the cost per equivalent unit for conversion costs
Cost Statement
Equivalents unit (A) Current period cost incurred (B) Cost per unit (B/A)
Material 5,365(a) $69,500(b) $12.95
Conversion 5,415(a) $82,300(b) $15.20
Therefore the Conversion cost for the first department for the month closest to $15.20
2. What are the ways of forecasting cost of sales?
a. cost of materials
b. cost of labor
c. cost of overhead
d. all of the choices
Answers
Answer:
d. all of the choices
Explanation:
Cost of Goods sold = Cost of material purchased + Conversion cost
And
Conversion cost hereby includes Direct labor cost and other production overheads directly attributable to the Goods sold.
So, The correct option is - d. all of the choices
Fill in the blanks in the table. Assume that the going wage for these workers is $500 per
week. If the wage is $500, how many workers would the ranch hire ?
Answers
A total of 3 worker will be hired for the ranch if the going wage for these workers is $500 per week.
What is a marginal labor?This refers to a firm increase in total production because of one additional unit of labor that is added while all other factors of production remain constant.
Given the information in the attached table, a total of 3 worker will be hired for the ranch if the going wage for these workers is $500 per week.
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Despite some optimism about the seeds of recovery, the Congressional Budget Office (CBO) sees joblessness rising. The CBO sees unemployment peaking at 10.4% next year from an average of 9.3% this year, before it falls to 9.1% in 2011."Source: Fortune, August 25, 2009Before the recession began, the U.S. unemployment rate was about 6 percent. As a recession begins, firms quickly make layoffs. Is this rise in unemployment mostly a rise in frictional, structural, or cyclical unemployment?The resulting rise in unemployment is mostly a rise in ______ unemployment because _______.cyclical; it is related to the state of the economy
Answers
Answer:
The resulting rise in unemployment is mostly a rise in __cyclical____ unemployment because it is related to the state of the economy.
Explanation:
Frictional unemployment occurs as a result of workers' search for or transition to new jobs. It is brief and does not leave a mark on the economy. Structural unemployment comes about when the skills of workers do not match the requirements of employers. Therefore, workers require retraining and reskilling. Cyclical unemployment relates to the macro-economic situation that is prevailing during periods of recession.
Forward Co. discarded a machine that cost $5,000 and was fully depreciated. The entry to record this transaction would include a credit to the
account.
Answers
Based on the fact that Forward Co. discarded a machine with cost $5,000, the entry to record this transaction in the books would include a credit to Machinery.
How do you dispose of fixed assets?When fixed assets are to be disposed of, the accumulated depreciation upt to that point is looked at to calculate the net book value.
This would then show the company if they made a profit or a loss when they sold the fixed asset with a profit being made when the selling price is higher than the net book value.
Regardless of the price the fixed asset is sold at, the company would record a credit to the fixed asset (machinery) account to show that the fixed asset account is decreasing.
In conclusion, there will be a credit to machinery.
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Which of the following is not true about amortization of Limited-Life Intangibles a. Amortize by systematic charge to expense over useful life. b. Credit asset account or accumulated amortization. c. Useful life should reflect the periods over which the asset will contribute to cash flows. d. Amortization should be cost less residual value. e. IFRS requires companies to assess the residual values and useful lives of intangible assets at least annually. f. None of the above
Answers
Answer:
Amortization of Limited-Life Intangibles:
f. None of the above
Explanation:
IFRS requires limited-life intangibles to be systemically amortized throughout their useful lives using either units of activity method or straight-line method. Intangibles are amortized to reduce their values as per use over their lifespan. Amortization is like depreciation, but depreciation is a term used for tangible assets, while amortization is used for intangible assets.
interventions startegices to reduce prevent restrictions or barriers of business in the shoes business
Answers
To reduce or prevent restrictions and barriers in the shoes business, the key approaches are: Advocacy and lobbying; Trade agreements and partnerships and Industry collaboration.
Engage in advocacy efforts to promote a favorable business environment for the shoes industry. Encourage the establishment of favorable trade agreements between countries or regions to reduce trade barriers, tariffs, and customs duties on shoes.
Collaborate with industry associations, competitors, and relevant stakeholders to set industry standards and best practices. This can help streamline processes.
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One of the mentioned assumptions of portfolio management theory is that investors are rational. A
rational investor:
Answers
Answer:
Prefers a higher return for a given risk and prefers a lower risk for given return.
Explanation:
Consider the market for land in central Pennsylvania, where land is used mainly for growing agricultural goods, as compared to the market for land in Rittenhouse Square, a small section of Philadelphia known for its cafes and shopping.
Because the supply of land in central Pennsylvania is_____, buyers in central Pennsylvania pay____for use of the land. The rental price of land is much lower in central Pennsylvania than in more densely populated areas like Rittenhouse Square. One possible explanation for this rent difference is that highly productive land is in low____.
Some entrepreneurs decide to build parking lots in Rittenhouse Square. The supply curve for land to be used for parking lots is_____.
Answers
The supply land in central Pennsylvania is perfectly inelastic, buyers in central Pennsylvania pay an interest rate for land use.
The rental price is lower in central Pennsylvania than Rittenhouse Square. One possible explanation for this rent difference is that highly productive land is downward sloping.
Some entrepreneurs decide to build parking lots on Rittenhouse Square. The supply curve for land to be used in parking lots is upward slopping.
Perfectly inelastic supply corresponds to one in which the demand curve is vertical, that is, the quantity demanded does not respond very strongly to price changes.
Buyers pay an interest rate for the use of the land, as the quantity demanded does not change if the price changes.
The rent price in central Pennsylvania is lower than in the Rittenhouse Squar due to the downward sloping curve that corresponds to lower interest expectations in the future, due to the elasticity of the supply.
The construction of parking lots in Rittenhouse Square is upward sloping because of the response to the profit that entrepreneurs hope to achieve in a perfectly elastic market.
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Three broad categories of definitions of quality are: product quality, service quality, and organizational quality. user based, manufacturing based, and product based. internal, external, and prevention. low-cost, response, and differentiation. Pareto, Shewhart, and Deming.
Answers
Answer:
user based, manufacturing based, and product based.
Explanation:
Quality is the degree in which the commodity meets the customer requirement at the beginning of its life as per ISO 9000
The impact of the quality could experience from the customer. The perception with regard to the quality of the product comes by the design & specifications and the accomplishment of the manufactured standards. The perception related to the service quality would arrive from the design of the process and the standard of the delivery
So as per the given situation, the above should be the answer
Mr. D is the manager of a local walgreens. His biggest concern is to make sure that his store is always making the most profit possible. He cuts costs by focusing on certain logistical decisions. Every other day walgreens receives shipments from pepsi, evian, hershey, and numerous other manufacturers. Walgreens insists on small shipments every two days, which helps to keep their inventory costs low. What system is mr. D using at walgreens to reduce his costs?.
Answers
The system is mr. D using at walgreens to reduce his costs is just in time inventory.
What is just in time inventory?JIT, or just-in-time inventory management, involves only ordering products from vendors when they are actually needed. This approach's primary goals are to lower the cost of keeping inventory and boost inventory turnover.With a just-in-time (JIT) inventory system, a business receives products as close as feasible to the moment they are actually required. As a result, if an auto assembly facility wants to install airbags, it doesn't maintain a supply on hand; instead, it gets them as the cars are put together.In conclusion. When used properly, JIT inventory can be a terrific method to reduce costs and boost productivity.
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give the advantages of business partnership structures
Answers
Answer:
Your welcome! Hope you have a nice wonderful day :)
Explanation:
One of the advantages of having a business partner is sharing the labor. Having a partner may not only make you more productive, but it may afford you the ease and flexibility to pursue more business opportunities. It might even eliminate the downside of opportunity costs.
When an employee leaves a position, how should the human resources department respond?
A. Post a job description to fill the position as quickly as possible.
B. Review the position to determine whether and when the position
should be filled again.
C.Train another employee to fill the position as quickly as possible.
D. Meet with college career advisors to advertise the position.
Answers
When an employee leaves a position, the right response of the human resources department will be to review the position to determine whether and when the position should be filled again.
What is the role of human resources department?In management, a Human resources refers to the division of a business that is charged with finding, screening, recruiting as well as training the job applicants. The HR managers also administers employee-benefit programs.
The department of human resources HR is an essential component of any business regardless of an organization's size. The department is mainly tasked with maximizing employee productivity and protecting the company from any issues that may arise within the workforce.
In conclusion, these HR managers plays an important role in helping companies deal with a fast-changing business environment and a greater demand for quality employees in the 21st century.
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Answer:
B. - Review the position to determine whether and when the position should be filled again.
Explanation:
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Yarin’s gross pay for the year was $3,500. The federal income tax withholding from his pay was 9% of his gross pay. Yarin determined the federal income tax he owes is $115. How much of a refund can Yarin expect?
a-$200
b-$315
c-$3,035
d-$3,185
Answers
Answer:
200
Explanation:
A. $200
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Drag each tile to the correct box.
What is the sequence of events that could lead to trade surplus?
Answers
What is trade surplus?
Trade surplus:- This term is used when the export of the country product is greater than the cost of imports.\(\purple{ \rule{300pt}{3pt}}\)
\(\large\underline{\underline{\maltese{\orange{\pmb{\sf{\: Answer :-}}}}}}\)
Events ⤵️1. the selling nation’s currency value appreciates
2. import cost for the buying nation goes up
3. demand for foreign currency increases
4. import goes down in the buying nation
5. the buying nation’s currency value depreciates
Sequence ⤵️import cost for the buying nation goes up demand for foreign currency increases import goes down in the buying nation the buying nation’s currency value depreciates the selling nation’s currency value appreciatesI.e. 2-3-4-5-1
6) When you were leading your in-house team, you displayed optimism by your demeanor each day. How can you best instill a spirit of optimism with your new remote team?
A) Frame challenges as opportunities and provide the tools to meet those opportunities.
B) Frame challenges as a part of business life and encourage your team to find ways to overcome them.
C) Display your same optimistic attitude when you are on video calls with your remote team.
Answers
One can best instill a spirit of optimism in your new remote team by displaying the same optimistic attitude when you are on video calls with your remote team. Thus the correct option is D.
As a leader, your approach and attitude can have a huge impact on the well-being and drive of your team, especially while working remotely.
Encouraging your team to solve difficulties and emphasizing the opportunities that challenges bring can also assist to build an optimistic and resilient attitude.
By regularly demonstrating an upbeat attitude during video calls and other contacts with your team, you can help to establish a sense of optimism and enthusiasm among your team members.
Therefore, option D is appropriate.
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A bond discount must be amortized using the effective-interest method if it yields annual amounts that are materially different than the straight-line method. be amortized using the straight-line method if it yields annual amounts that are materially different than the effective-interest method. always be amortized using straight-line amortization. always be amortized using the effective-interest method.
Answers
Answer:
A bond discount must:
always be amortized using the effective-interest method.
Explanation:
The effective interest method is the accepted accounting standard used to amortize bond discounts. It is also preferred by investors and analysts who want to determine the actual interest earned on the bonds. It is more logical than the straight-line method. Therefore, it must always be used, except for the simplicity offered by the straight-line method.
Which of the following best explains how news of a recession affects consumption?
Answers
Answer:
News of recession will cause consumers to purchase more. Which of the following best explains how news of a recession affects consumption?.tax cuts to stimulate consumption and investment, or direct increases in government spending that would shift the aggregate demand curve to the right.
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When Carter decided to start a luxury cologne company, he hired a wealthy
aristocrat from France as his primary spokesperson. Which aspect of the marketing
mix focuses on this action?
(1 point)
O positioning
O price
O unique selling proposition
O personal selling
Answers
Answer: Personal Selling.
Explanation:
Personal Selling. Personal selling focuses on the direct communication and relationship building between the company and the customer. In this case, Carter hired a wealthy aristocrat from France to be the spokesperson for his cologne company, which is an example of personal selling.
Even though the goal of a firm is to create wealth for its shareholders, there are times when ethical or strategic considerations outweigh the profit incentive, causing managers to reject investments with positive net present values. T/F
Answers
True. Even if a business's main goal is to maximize profits for its shareholders, there are occasions when ethical or strategic considerations trump the financial one, forcing management to forgo deals with good net present values.
Is a company's main goal to maximize profits or the wealth of its shareholders?The company's top priority is consistently increasing shareholder wealth, which produces earnings to increase the dividends paid on each ordinary share. A sign of greater shareholder wealth is the higher price of shares traded on the stock market.
Is it always morally right for a business to attempt to maximize profits for its shareholders?A corporation's desire to increase profits for the benefit of its stockholders is not always morally good. For some businesses, a commitment to morality is insufficient to boost earnings. For tiny enterprises or organizations that are dealing with particular issues, ethics is insufficient.
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Applying the conept of "Thinking at Margin" which of the following statements are relevant for a TV manufacturer to make a decision:
the average revenue of a television is $114.55
the average cost of 10 televisions is $100 each, while the 11th one requires the hiring of an extra truck for deliveries at $50
the total cost of a television is $1104.55
the average cost of a television is $104.55
Answers
Applying the concept of "Thinking at Margin", the relevant statement for a TV manufacturer to make a decision is: the average cost of 10 televisions is $100 each. Option C. This is further explained below.
What is Thinking at Margin?Generally, It implies giving some thought to the next move you will take. "extra" is the meaning of the term "marginal." On a hot day, the first glass of lemonade you drink satisfies your thirst, but the subsequent glasses may not have the same effect.
When you ponder at the margin, you are contemplating what the next or subsequent action will entail for you personally.
In conclusion, Using the "Thinking at Margin" methodology, the important statements for a television maker to consider while making a choice are as follows: the typical cost of producing 10 TVs is $100 apiece. Alternative C
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The following transactions occur for the Wolfpack Shoe Company during the month of June:
Provide services to customers for $30,000 and receive cash.
Purchase office supplies on account for $20,000.
Pay $7,000 in salaries to employees for work performed during the month.
1. Analyze each transaction.
2. Record the transaction.
3. Post the transaction to T-accounts. Assume the opening balance in each of the accounts is zero.
Answers
Answer:
1.
Assets = $30,000 (increase) and Revenue = $30,000 (increase)
Assets = $20,000 (increase) and Liabilities = $20,000 (increase)
Assets = $7,000 (decrease) and Liabilities = $7,000 (decrease)
2.
Cash $30,000 (debit)
Service Revenue $30,000 (credit)
Cash Received for Service Rendered
Office Supplies $20,000 (debit)
Accounts Payable $20,000 (credit)
Office Supplies purchased on credit
Salaries Expense $7,000 (debit)
Cash $7,000 (credit)
Salaries Paid
3.
Cash Account
Debit :
Service Revenue $30,000
Credit :
Salaries Payable $7,000
Balance c/d $23,000
Revenue Account
Debit :
Balance c/d $30,000
Credit :
Cash $30,000
Office Supplies Account
Debit :
Accounts Payable $20,000
Credit :
Balance c/d $20,000
Accounts Payable Account
Debit :
Balance c/d $20,000
Credit :
Office Supplies $20,000
Salaries Expense Account
Debit :
Cash $7,000
Credit :
Balance c/d $7,000
Explanation:
Accounting starts with analyzing transactions and their effects on Assets, Liabilities, Equity, Revenues and Expenses.
The next stage is to record the transactions in Journals. See journals and narrations above.
Then the preparation of Ledger Accounts using the Journal entries.
On June 15, 2021, Allen sold land held for investment to Stan for $65,000 and an installment note of $300,000 payable in five equal annual installments beginning on June 15, 2022, plus interest at 10%. Allen’s basis in the land is $255,500. What amount of gain is recognized in 2021 under the installment method?
Answers
Using the installment method means that the amount of gain that will be recognized in 2021 is $27,857.14.
How to use the installment method to find gain recognized?When a payment is to be made in installments, then the gain to be recognized in a year can be found by the installment method:
= Profit margin x Amount paid in 2021
The Profit margin can be found by the formula:
= ( Selling price of land - Seller's basis in the land) / Seller's basis in the land
= ( ( 300, 000 + 65, 000) - 255, 500) ) / 255, 500
= 109, 500 / 255, 500
= 42. 857 %
The gain to be recognized on the land sold by Allen to Stan is therefore:
= 42. 857 % x $ 65, 000
= $27,857.14
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Rossdale Co. stock currently sells for $69.35 per share and has a beta of .90. The market risk premium is 7.30 percent and the risk-free rate is 2.95 percent annually. The company just paid a dividend of $3.65 per share, which it has pledged to increase at an annual rate of 3.35 percent indefinitely. What is your best estimate of the company's cost of equity
Answers
Answer:
9.52%
Explanation:
Cost of equity can be determined using the capital asset pricing model
he capital asset price model: cost of equity = risk free + (beta x market risk premium )
Risk free return = return on a risk free asset
Beta is a measure of the systematic risk.
Risk premium = market rate of return - risk free rate
2.95% + (0.90 x 7.30%) = 9.52%
A company issues $50,000 of 4% bonds, due in 5 years, with interest payable semiannually. Assuming a market rate of 3%, the bonds issue for $52,306. Calculate the carrying value of the bonds after the first semiannual interest payment.
Answers
The carrying value of the company's bonds after the first semiannual interest payment is $52,090.59.
Data and Calculations:
Face value of bonds = $50,000
Bonds Proceeds = $52,306
Bonds Premium = $2,306 ($52,306 - $50,000)
Maturity Period = 5 years
Coupon interest rate = 4%
Market interest rate = 3%
Interest Payment = Semiannually
First Semiannual Interest Payment:
Cash payment = $1,000 ($50,000 x 4% x 1/2)
Interest expense = $784.59 ($52,306 x 3% x 1/2)
Amortization of premium = $215.41 ($1,000 - $784.59)
Carrying value = $52,090.59 ($52,306 - $215.41)
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Which word best describes the international banking system?
O A. Decentralized
O B. Unimportant
O C. Nonexistent
D. Controlled
Answers
Please answer need help asap
Answers
Answer:
Machinery
Explanation:
Who is a business letter not written by?
Answers
A business letter is not written Option C. between two private individuals.
A business letter is a formal letter used by businesses or companies to communicate with customers, clients, other companies, or government officials. It is used for various purposes, such as requesting information, placing orders, providing feedback, making inquiries, making claims, making offers, and more. Business letters are different from personal letters in that they are more formal, objective, and to the point.
Business letters are usually written by a company's employees who have the authority to do so. For instance, the sales team may write letters to prospective clients to solicit their business, while the human resources department may write letters to job applicants to inform them of their application status. There are various types of business letters, and each serves a different purpose. Some common types of business letters include:
1. Inquiry letters: Used to request information about products, services, or pricing.
2. Order letters: Used to place orders for goods or services.
3. Complaint letters: Used to make a formal complaint about a product or service.
4. Adjustment letters: Used to respond to a complaint or request for an adjustment.
5. Sales letters: Used to sell a product or service.
6. Acknowledgment letters: Used to acknowledge receipt of an order, complaint, or request.
7. Employment letters: Used to communicate with job applicants, employees, or ex-employees.
8. Invitation letters: Used to invite someone to an event or occasion.
9. Cover letters: Used to accompany a resume or job application.
Business letters are important because they create a record of communication between two parties, and they provide a paper trail of events. They are also important because they can be used in legal proceedings, as they show that the parties communicated about a particular matter. Therefore, the correct option is C.
The question was incomplete, Find the full content below:
A business letter is not written
A. between a company and its customers or clients
B. between one company and another company
C. between two private individuals
D. to employees within a company to recognize important achievements
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A benefit of a monopoly is：
a. greater creativity by authors who can copyright their novels.
b. a wide variety of similar products.
c. decreasing long-run average total costs.
d. lower prices.
Answers
A benefit of a monopoly is: a. greater creativity by authors who can copyright their novels.
What is monopoly?Because they give artists and innovators the chance to acquire exclusive rights and financial rewards through intellectual property rights, such as copyright protection, monopolies may be an incentive for creativity and innovation.
Knowing that they may enjoy exclusive ownership and possible financial advantage from their works might motivate authors to invest in producing original and distinctive works.
Therefore the correct option is A.
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Suppose the CPI was 110 last year and is 121 this year.
Instructions: In part a, enter your answer as a whole number. In part b, round your answer to 1 decimal place. If you are entering any negative numbers be sure to include a negative sign (-) in front of those numbers.
a. What is this year’s inflation rate?
____ %
b. In contrast, suppose that the CPI was 110 last year and is 108 this year. What is this year’s inflation rate?
____ %
c. What term do economists use to describe this second outcome?
Inflation or Deflation
Answers
The inflation rate is 10%, which can be computed the second answer is -1.8%. third outcome called deflation.
How to calculate CPI?a) The formula to CPI is
\(CPI= \frac{current CPI-past CPI}{past CPI}\)
\(CPI= \frac{121-110}{110}\)
CPI= 0.1 or 10%
b) \(CPI= \frac{current CPI-past CPI}{past CPI}\)
\(CPI= \frac{108-110}{110}\)
CPI= -0.18%
A decrease in the economy's overall price level is referred to as deflation, whereas a temporary slowdown in price inflation is known as disinflation. A decrease in the money supply, reductions in government and consumer expenditure, and reductions in corporate investment can all contribute to deflation, which is bad for an economy.
A progressive drop in consumer prices for products and services is known as price deflation. This is frequently brought on by the deflationary gap, also referred to as the demand gap, which is characterized by high supply and low demand. Consumers and businesses hold on to their money rather than spending it because they anticipate a decrease in pricing.
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