Economics Answers

Suppose that the economy is characteised by the following behavioral equations C=Co +c1Yd
Where : Co=280
I=270
G=300
T=200
Marginal propensity to save (MPS) is 0.4(or 40%)
Solve for
a) equlibrum Gdp (Y)
b) disposable income (Yd)
C) Consumption spending (C)

Consider the following information to answer questions Government spending = R550 Exports = R330 Autonomous consumption = R280 Autonomous imports = R170 Investment expenditure = R120 Marginal propensity to consume =0,75 Full employment level of income =R5700

What is the value of the multiplier?
a. 2
c. 2,50
d. 4
c. 3

Assume that American rice sells for $100 per bushel, Japanese rice sells for 16,000 yen per bushel, and the nominal exchange rate is 80 yen per dollar.

(a) If other people exploit the same opportunity, what would happen to the price of rice in America and price of rice in Japan.

(b) Suppose rice is the only commodity in this world and law of one price and Purchasing Power Parity (PPP) theory hold. What would happen to real exchange rate between America and Japan?

Demonstrate the relationships and links between various international parity conditions, and explain the meanings and implications of each of them.

3) A sticky goo oozes mysteriously from the rare wazoo tree, which grows only on the farm of Wolf Molder, just outside of Pullman, Washington. This goo, when smeared on the face, results in a tightening of the skin and the elimination of fine lines. Wolf bottles the goo at a cost of $2 per bottle and sells it to Donna Scali at a wholesale price of $w per bottle. Donna sells the goo to the general public over the Internet under the name “Youth Goo” at a price of $P per bottle. The retail demand for Youth Goo is given by P = 60 - .01Q.
(a) Write Donna Scali’s profit as a function of the number of bottles of Youth Goo she sells over the Internet and the wholesale price, πD(Q;w).
Write an equation characterizing Donna’s profit-maximizing choice of output as a function of the wholesale price w.
(b) What is Wolf’s profit as a function of the number of bottles of Youth Goo he sells to Donna, πW(Q)?
What is Wolf’s profit-maximizing choice of output?

Complete Part 2 of Form 940 based on the following information: (Round your answers to two decimal places, if necessary.)
Total payroll for the year $913,590
Payroll to employees in excess of $7,000 $421,930
Employer contributions into employees' 401(k) plans
If the employer is located in California, which has a credit reduction of 2.1%, what would be the amount of the credit reduction?

Use the net FUTA tax rate of 0.6% on the first $7,000 of taxable wages.

Queno Company had FUTA taxable wages of $510,900 during the year. Determine its: (Round your answers to two decimal places.)

a. gross FUTA tax $
b. FUTA tax credits (assuming no penalties) $
c. net FUTA tax

Use the net FUTA tax rate of 0.6% on the first $7,000 of taxable wages.

Niemann Company has a SUTA tax rate of 7.1%. The taxable payroll for the year for FUTA and SUTA is $82,600.

Use the net FUTA tax rate of 0.6% on the first $7,000 of taxable wages.

Hunter Company had a FUTA taxable payroll of $192,700 for the year. Since the company is located in a state that has 1.5% FUTA credit reduction due to unpaid loans, determine Hunter's FUTA tax liability for the year.

Use the net FUTA tax rate of 0.6% on the first $7,000 of taxable wages.

Faruga Company had FUTA taxable payrolls for the four quarters of $38,400; $29,600; $16,500; and $8,900, respectively. What was the amount of Faruga’s first required deposit of FUTA taxes?