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Why a sudden decrease in desired consumption expenditure would lead to an sudden increase in actual investment?
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∙ 12y ago
It is as you are Gida.
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∙ 12y ago
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A decrease in a firm's willingness to pay dividends might result from an increase in its?
Expenditure & losses...
3 examples of how to make a profit?
# Increase Sales # Decrease Expenditure # Bring out a new service/product?
A decrease in a firm's willingness to pay dividends is likely to result from an increase in its what?
A decrease in a firm's willingness to pay dividends is likely to result from an increase in its profitable investment opportunities. A dividend is a payment made by a corporation to its stockholders. It is a usually a distribution of profit.
What is the increase in the value of a investment?
basically it is the increase in the value of an investment.
What is the difference between investment and net investment?
"Net investment" deducts depreciation from gross investment. Net fixed investment is the value of the net increase in the capital stock per year.
What make a shift in the aggregate demand curve?
An increase or decrease in consumption, investment, government expenditure or net exports
Does alcohol consumption tends to decrease or increase self awareness?
Decrease
Are consumption and income positively related or are they negatively related?
They are positively, or directly related. An increase in income is associated with an increase in income; a decrease in consumption accompanies a decrease in income.
A decrease in a firm's willingness to pay dividends might result from an increase in its?
Expenditure & losses...
3 examples of how to make a profit?
# Increase Sales # Decrease Expenditure # Bring out a new service/product?
Why does GDP equal to total expenditure?
GDP is the total output by an economy. if GDP increases, it will generate more ecnomic activity, more jobs and therefore increased wages for people. With these wages, people can increase their total expenditure. Total expenditure = consumer consumption + investment + government spending + net exports with more money from income, individuals will spend more on consumption and money which was saved in banks can be used to invest in firms. the taxes people pay will go to the government to spend. this will increase total expenditure. If GDP is low, then theres less acitivity in the economy, less jobs, less wages, less taxes, more government spending and a higher deficit and therefore total expenditure decreases.
Psychological law of consumption?
Generally it is observed that when income increases, consumption also increases but by a less proportion than the increase in income. Suppose the total income of the community is 10 crore and the consumption expenditure is also Rs 10 crore. In that case, there is no saving and investment. Further the income increases to Rs.15 crore. Then, consumption also increases, but not to the extent of Rs15 crore. It may increase to Rs14 crore and Rs 1 crore constitutes the savings. This savings create a gap between Income and Consumption. This gap is in conformity with Keynes Psychological law of consumption, which states that, when aggregate income increases, consumption expenditure shall also increase but by a somewhat smaller amount". This law tells us that people fail to spend on consumption the full amount of increment in income. As income increases, the wants of the people get satisfied and as such when income increases they save more than what they spend. This law may be considered as a rough indication of the actual macro - behaviour of consumers in the short run. This is the fundamental principle upon which the Keynesian consumption function is based. It is based upon his observations and conclusion derived from the study of consumption function. This law is also called the fundamental law of consumption. It consists of three inter related propositions: # When the aggregate income increases, expenditure on consumption will also increase but by a smaller amount. 2. The increased income is distributed over both spending and saving. 3. As income increases, both consumption spending and saving will go up. These three prepositions form Keynes psychological law of consumption. As consumption expenditure progressively diminishes when income increases, a gap between income and expenditure arises. This tendency is so deep rooted in people's habits, customs, and the psychological set up that it is difficult to change in the short run. Hence, it is impossible to raise the propensity to consume of the people so as to increase the national output, income and employment. Increasing the volume of investment in an economy can only fill up the gap between income and Consumption.
If a good is a normal good what will happen to its consumption as income increases?
The definition of a Normal Good is: a good that will increase in consumption as income increases and decrease in consumption as income decreases.
PSA Singapore contribution to Singapore GDP?
PSA controls the port. This means imports and exports can be allowed or stopped by PSA if it is shipped. GDP, which is Gross Domestic Product, is commonly calculated by the expenditure method (from wikipedia):GDP = private consumption + gross investment + government spending + (exports − imports) If PSA control part of the imports and exports, he can choose to increase or decrease them. That will affect Singapore's GDP.
Why does an increase in autonomous taxes have the same effect on equilibrium output as does an decrease in autonomous transfers?
taxes indirectly decrease Y, it does this by decreasing consumption
How is fiscal policy controlled?
Taxes, and government spending. Increasing taxes will decrease consumption and supply. Lowering taxes will increase consumption and supply. Increasing government spending will increase national consumption, and decreasing government spending will decrease national consumption. The economics AD-AS model shows a visual representation of the effects of fiscal policy on the economy if you are further interested.
What increases and what decrease capital or owners equity?
Increase capital through additional investment of the owner, increase in income Decrease capital through withdrawal of the money made by the owner, incur losses
