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In 2009, ABC Company made $2M of net profit and spent $100,000 on advertisement. In 2010, it made $2.5M of net profit and spent $150,000 of advertisement. Based on this information, if ABC's advertisement expenditure increases by $20,000 in 2011, how much do you expect its net profit to increase? Explain why the ratios of net profit to advertisement expenditure in 2009 and 2010 are different from the slope of the net profit advertisement relationship.
Why are the imports subtracted when GDP is measured in expenditure approach? If you woke up in the working & found that nominal GDP has doubled overnight. what statistic wou
Foreign exchange risk is the level of uncertainty that a company must handle for changes in foreign exchange rates that will unfavourably affect the money the company receives for
Illustrate an example of Consumer Price Index For instance, if we spend twice as much on apples as on pears, apples would have twice the weight in basket. The precise details o
definition of cheap money
Suppose the US and Mexico both produce semiconductors and auto parts and the US has a comparative advantage in semiconductors while Mexico has a comparative advantage in auto parts
Q. What do you mean by yield curve? Yield curve is a graph of interest rates of different maturity (recalculated to yearly rates) at a specific point in time. It's common for t
The number of gallons of paint that Home Depot sells in a given day is normally distributed with a mean of 150 gallons and a standard deviation of 35 gallons (I realize that the di
Suppose the economy is currently in recession, and the exchange rate if fixed using the IS-LM model. a) Explain and illustrate the economy adjustment (in the medium run) b) E
Q. Explain the Money market diagram? Let's begin by studying the money market when GDP is given. When Y is given, MD will only rely (negatively) on R and we can draw a figure w
Q. Show factors that govern the Price Elasticity of Demand? a. The number and closeness of the substitutes- The more and the better the substitutes, the grater is the Price Ela
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