Compare the features of the classical economic model to the Keynesian economic model. How do these models influence the aggregate demand curve and the aggregate supply curve? Which model, in your opinion, benefits the economy in the long-run?
Answers
The classical economic model and the Keynesian economic model are two prominent schools of thought in economics that offer different perspectives on how the economy works and how government policies should be formulated.
Let's compare the features of these models and discuss their influence on the aggregate demand curve and the aggregate supply curve.
Classical Economic Model:
Market Mechanism: The classical model emphasizes the role of free markets in allocating resources efficiently. It assumes that markets are self-regulating and tend towards equilibrium.
Say's Law: It assumes that supply creates its own demand. In other words, the production of goods and services generates income, which, in turn, leads to spending and consumption.
Laissez-Faire Policy: The classical model suggests minimal government intervention in the economy. It believes that markets will naturally adjust to any imbalances and achieve full employment in the long run.
Long-Run Focus: It emphasizes the importance of long-run equilibrium and believes that the economy will self-correct over time.
Keynesian Economic Model:
Aggregate Demand: The Keynesian model places significant emphasis on aggregate demand, arguing that it is a key driver of economic activity. It suggests that fluctuations in aggregate demand can lead to periods of recession or inflation.
Role of Government: The Keynesian model advocates for active government intervention, especially during economic downturns. It recommends fiscal policy measures such as increased government spending or tax cuts to stimulate demand and boost economic activity.
Sticky Wages and Prices: It recognizes that wages and prices may not adjust immediately in response to changes in demand. This leads to the possibility of short-term unemployment or inflationary gaps.
Short-Run Focus: The Keynesian model emphasizes short-run stabilization policies to address fluctuations in output and employment.
In terms of their influence on the aggregate demand curve and the aggregate supply curve:
The classical model suggests that changes in aggregate demand have a limited impact on the overall level of output and employment in the long run. It views the aggregate supply curve as vertical, indicating that increases in aggregate demand will lead to higher prices rather than higher output.
The Keynesian model argues that changes in aggregate demand can have a significant impact on output and employment, particularly in the short run. It views the aggregate supply curve as upward-sloping, suggesting that increases in aggregate demand can lead to higher output without a substantial increase in prices.
Regarding which model benefits the economy in the long run, opinions may vary among economists. Classical economists argue that a free-market system with minimal government intervention promotes long-run economic growth and efficiency. Keynesian economists, on the other hand, emphasize the role of government policies in stabilizing the economy and reducing economic fluctuations.
In practice, a blend of both models is often employed by policymakers. During periods of stable economic growth, the classical model's focus on market mechanisms and long-run equilibrium may be more applicable. However, during recessions or economic downturns, Keynesian policies such as fiscal stimulus can be used to mitigate the negative impacts and stimulate economic activity.
Ultimately, the choice between the two models depends on the specific circumstances of an economy and the prevailing economic conditions. Policymakers need to consider a range of factors, including the state of the economy, the causes of any imbalances, and the potential effectiveness of different policy tools, to determine the most suitable approach.
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Related Questions
Explain how Transnet could respond to disruption as a risk by
making use of the ‘risk management process’
Answers
Transnet can ensure that it is prepared to deal with disruption risks. This process allows Transnet to identify potential disruptions, assess their impact, and develop and implement strategies to reduce their likelihood and mitigate their consequences. This helps Transnet to ensure that its services continue to operate smoothly, even in the face of disruptions.
Transnet could respond to disruption as a risk by making use of the ‘risk management process’ as follows:
Transnet is a state-owned enterprise that is responsible for managing South Africa's railway, ports, and pipeline infrastructure. It must respond to disruption risks in order to ensure that its services continue to run without interruption. Transnet's risk management process can assist it in identifying and addressing potential disruptions.
Explanation
Transnet's risk management process has the following steps:
1. Identify risks: The first step is to determine the sources of disruption and the likelihood of these risks occurring.
2. Analyze risks: The next stage is to assess the potential impact of these disruptions on Transnet's services and to prioritize them based on their severity
.3. Develop risk management strategies: The next stage is to develop strategies for reducing the likelihood of these risks and mitigating their consequences.
4. Implement risk management strategies: The next stage is to implement the strategies and monitor their effectiveness.
5. Review and improve the risk management process: The last stage is to evaluate the effectiveness of the process and make adjustments where necessary.
Conclusion
Therefore, by following this risk management process, Transnet can ensure that it is prepared to deal with disruption risks. This process allows Transnet to identify potential disruptions, assess their impact, and develop and implement strategies to reduce their likelihood and mitigate their consequences. This helps Transnet to ensure that its services continue to operate smoothly, even in the face of disruptions.
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what is the law of demand definition economics?
Answers
The law of demand is a fundamental principle in economics that explains the inverse relationship between the price of a good or service and the quantity demanded by consumers.
According to the law of demand, all other factors being equal, as the price of a good or service increases, the quantity demanded by consumers decreases, and vice versa. This means that when the price of a good or service is high, consumers are less likely to purchase it, either because they cannot afford it or because they are seeking lower-priced substitutes. Conversely, when the price of a products or service is low, consumers are more likely to purchase it, either because they can afford it or because it represents a good value compared to other options. The law of demand is a basic principle of market economics and is essential for understanding how markets function and how prices are determined.
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The law of demand, a foundational concept in economics, describes the inverse connection between the cost of a commodity or service and the amount required by customers.
When all other variables are held constant, the law of demand states that when an item or service's price rises, customer demand for a given amount declines, and vice versa. As a result, customers are less inclined to buy expensive goods or services, either because they cannot afford them or because they are looking for less expensive alternatives. On the other hand, when a good or service is inexpensive, customers are more likely to buy it, either because they can afford it or because it is a good deal compared to other possibilities. It is crucial to comprehend how markets operate and how prices are set in order to fully appreciate the rule of demand, which is a fundamental tenant of market economics.
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Which completes the equation?
O + A + Consideration (+______) = K
Legal capability
Legal capacity
Legal corporations
Legal injunction
Answers
"Legal capacity" is the final term that completes the equation.
What is the full legal age?What a person is legally capable of doing depends on the rules and regulations of the legal system. It is a fiction with no underlying reality that every legal system uses to establish a relationship with its constituents.
What does the legal competence to contract mean?A party has the legal authority to enter into a contract if they have the capacity to do so. Capability also implies that a person must be legally competent. A person's ability is determined by two factors: whether they are of legal age to enter into contracts and if they are mentally able to do so.
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Which of the following is an example of an action that is part of making a
rational choice?
A. Doing a cost-benefit analysis.
B. Calculating flexible and fixed expenses.
C. Expanding your discretionary spending.
D. Adding up your assets.
Answers
Step by step explanation:
The meaning of rational is doing someone with reason or logic so B seems like the rational answer..
Answer:
A. Doing a cost-benefit analysis.
Explanation:
i took the test
A business opportunity that match traveling
Answers
Answer:
Steward or stewardess assistant
Explanation:
Like a plane servant ,if u r up for it though...
The most common time frame individuals use when developing a budget is _____. A) Yearly B) Monthly C) Daily D) Weeklyeco
Answers
Answer:
Monthly
Explanation:
the 2007–2009 recession was brought on when the federal reserve used excessive tightening of the money supply to solve the period of stagflation from 2004 to 2007. true/false
Answers
The 2007–2009 recession was brought on when the federal reserve used excessive tightening of the money supply to solve the period of stagflation from 2004 to 2007 is false.
Why is the statement not true?The 2007-2009 recession, also known as the Great Recession, was primarily caused by the collapse of the housing market, which led to a financial crisis.
This was due to a combination of factors, including subprime mortgage lending, excessive risk-taking by financial institutions, and the securitization of mortgages.
The Federal Reserve's monetary policy during this period was not primarily focused on combating stagflation, and excessive tightening of the money supply was not the main cause of the recession.
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Online companies create a ________consumers gain information that turns them into sophisticated customers, opportunities to customize products easily, and entertainment content; marketers gain information about consumers that allows them to be more efficient and precise when marketing their products.
Answers
Answer:
a value exchange
Explanation: Hope this help:)
Which of the following is an example of inventory at a company?
A.
A scooter that has been purchased at a store by a customer
B.
An employee who provides technical expertise
C.
Fancy dishes and silverware used at a restaurant
D.
A list of products that a hardware store wants to order
Answers
Answer is option c) Fancy dishes and silverware used at a restaurant
what is inventory at a company ?
The term "inventory" refers to all the products, materials, goods, and merchandise that a company has on hand and intends to sell to customers for a profit. Inventory at a manufacturing company includes raw materials utilised in production, as well as semi-finished goods stored in warehouses or on factory floors, in addition to the finished product that has been manufactured and is available for sale. In a service industry, since there is no exchange of physical stock, the inventory is mostly intangible in nature. So the service industry inventory mostly includes the steps involved before completing a sale.
Inventory is:
An asset, tangible or intangible,An asset that can be realized for revenue generation or has a value for exchange, orAn asset which is in process but is meant for sale in the market.Different types of inventory :
Raw materialsWork in progressFinished goodsMRO inventoryBuffer inventoryCycle inventoryDecoupling inventoryTransit inventoryFor any manufacturing or trading company, inventory is a crucial asset, thus it's critical for business leaders to comprehend what it truly means. In addition to the general definition, some sectors of the economy, such as manufacturing and services, employ specialised definitions that take into account all of the assets specific to those sectors. Business owners can better understand how their inventory is serving them by understanding the many forms of inventory, including those that aren't directly used in accounting.
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Which of the following is a source of insurance? *
Answers
Answer:
Court ruling
Regulations
distinguish between individual Centred career and Organisation Centred career
Answers
Answer:
please check my profile
Explanation:
The price of ______ goods is a determinant of demand.
Answers
Generally, the price of other goods is an important determinant of demand for a product.
What are the determinants of demand?The determining factor for demand level of a product includes changes in income, prices of related goods, consumer expectations, consumer tastes etc.
Therefore, the price of other goods is an important determinant of demand for a product.
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Microeconomics is the study of the behavior of individuals and companies and the choices they make in the economy
Answers
Answer:
Microeconomics studies the decisions of individuals and firms to allocate resources of production, exchange, and consumption. Microeconomics deals with prices and production in single markets and the interaction between different markets but leaves the study of economy-wide aggregates to macroeconomics
Support Material
Business functions
Activity 1:
Study the following scenarios and answer the questions that flow:
1.1 The sales department is constantly running out of stock because stocks are not ordered on time. The admin clerk is new and files the documents in the wrong place. The purchasing department was not even aware that they should order more stock.
1.1.1 Which department created the problem?
1.1.2 What will the consequences be if the sales department constantly runs out of stock?
1.1.3 How can the problem be solved?
1.2 The creditors are not paid on time and added interest to the account of the business.
1.2.1 Which department created the problem?
1.2.2 What will be the consequences if this continues to happen?
1.3 The workers are always complaining of the third grade stock they have to sell to customers.
1.3.1 Which department created the problem?
1.3.2 How can the problem be solved?
1.4 Clients are constantly surprised on the new items they get on the shelves and some of which they have not seen before?
1.4.1 Which department created the problem?
1.4.2 How can this problem be prevented in future?
Answers
In the scenario given, the department that was said to have created the problem is the admin department because the document to show that there was low stocks was filled in the wrong place and as such, the purchasing department was not made aware.
1.1. What will the consequences be if the sales department constantly runs out of stock?The consequences are:
They will have issues with customers demanding product and unfulfilled orders.Complains and lastly they will lose customers.How can the problem be solved?There should be a computerized system on all product and their quantities should be included such that when the product is getting low on stock, the system will alert the admin and appropriate steps to new buy product will be taken
1.2. Which department created the problem?Since the creditors were not paid on time, the department that created the problem is also the admin department
What will be the consequences if this continues to happen?They we be close done.They will not have anyone who will sell products to them.1.3.Which department created the problem?The purchasing department created this problem.
How can the problem be solved?The purchasing department need to buy quality Stocks. They can hire a professional who knows the quality so that he or she can help with the purchase.
1.4.
Which department created the problem?The sales department created this problem
How can this problem be prevented in future? The sales department need to use a method that will not surprise the people such that they can be create an ad or place the new product one at a time not all new product at the same time.
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50) Inventory does not include:
A) Materials used in the production of goods to be sold.
B) Assets intended to be sold in the normal course of business.
C) Equipment used in the manufacturing of assets for sale.
D) Assets currently in production for normal sales. ,
Answers
Inventory is a crucial part of any business that deals with the production and sale of goods.
It represents the value of goods that are held for sale, including raw materials, work in progress, and finished goods. However, inventory does not include all assets related to the production and sale of goods.
Option A is incorrect because materials used in the production of goods to be sold are considered part of inventory. These materials may include components, raw materials, and other items used in the production process.
Option B is incorrect because assets intended to be sold in the normal course of business are also considered part of inventory. This may include finished goods that are ready to be sold to customers.
Option C is incorrect because equipment used in the manufacturing of assets for sale is considered part of property, plant, and equipment. This equipment is not included in inventory because it is not held for sale.
Option D is the correct answer because assets currently in production for normal sales are considered work in progress, not inventory. Work in progress represents goods that are in the process of being produced but are not yet ready to be sold.
In conclusion, inventory does not include assets currently in production for normal sales. Instead, it includes finished goods ready to be sold, raw materials, and work in progress.
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Question 2(Multiple Choice Worth 5 points)
(02.06 MC)
In general, what kind of people earn the most money?
O People with skills that are in high demand and high in supply
O People with skills that are in high demand but low in supply
O People with skills that are in low demand and low in supply
People with skills that are in low demand but high in supply
Answers
They earn the most money since skills also follow the law of supply and demand, so consumers are willing to pay more due to low supply
which of the following is the correct word phrase of "4b+10"?
A. four added to 10
B. the product of four and B added to 10
C. the sum of 4 and B plus 10
D. the product of four and B subtracted to 10
Answers
4b can be interpreted as 4 multiples by b. B is a variable in this expression. Plus 10. So it would the product of four and B added to 10.
In order to satisfy the needs and wants that people have, businesses must combine factors of production. The factors of
production are: Capital, Enterprise, Land, Labour.
Case Study:Freshz Coffee
Freshz Coffee has just opened in Dubai. FreshZ will need factors of production.
Give examples of the factors of production it will need and how they will be used.
Answers
Answer:
by utilizing the goods by their proper uses
When price of a product increases, what does the law of supply state will happen to quantity supplied?
Answers
According to the law of supply, manufacturers will increase their supply to the market if the price is higher.
What occurs to supply when a product's price goes up?According to the law of supply, there is an direct correlation between price and the amount delivered. In other terms, when the price rises, the amount supplied rises as well. The quantity of a product supplied, or the amount proprietors and producers offer for sale, is said to rise as the market price increases and decrease as the prices fall according to the law of supply. In contrast, the demand law (see demand) states that when a good's price increases, less of it is sought and vice versa.
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Annoying isn't it. When people purposely answer your question when they know it's completely useless. Kinda like how I specifically told people NOT to answer the questions I asked because I was doing an experiment, and every time I did that, two people purposely answered my question when they were told not to.
People are d. i. c. k. s.
Answers
Answer:
wow
Explanation:
I'm gonna type a random answer
during december, vixen company sells $863,000 in merchandise that has a one-year warranty. warranty expense is estimated at 3% of sales. on january 5 of the following year, the merchandise requires repairs that are completed the same day. the repairs cost $15,300 for materials taken from parts inventory. the entry to record the repairs that occur on january 5 is:
Answers
The entry to record the repairs that occur on January 5 is Debit warrant expense $25,500, Credit estimated warranty liability $25,500.
Warranty Liability is a liability account that records the amount of repair or replacement costs a company expects to pay for products already shipped or services already rendered.
When a guarantee liability is calculated for a specific period, this amount is recorded as a liability in the balance sheet and as an expense in the general ledger. Over time, the amount actually spent paying the security deposit will be deducted from the liability amount rather than appearing as a new expense.
If the product is damaged or defective, the company that provides the full warranty must repair or replace it within a reasonable time. A limited warranty works similarly, but with more restrictions.
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Assume you are currently planning an audit for a profit-orientated small enterprise business (private). List 3-4 examples of potential users of the financial statements. The engagement partner has asked you to calculate the relevant materiality amounts for the audit (Materiality, PM, AMPT). Assume the relevant benchmark is based off on Net Income before Tax, and the amount is $1,000,000. (10 marks)
Please calculation is required.
Answers
Potential users of financial statements for a profit-oriented small enterprise include owners/shareholders, creditors, and potential investors.
Examples of potential users of the financial statements for a profit-oriented small enterprise business include:
1. Owners/Shareholders: The owners or shareholders of the business would be interested in the financial statements to assess the profitability and performance of their investment. They use the information to make decisions about retaining or selling their ownership stake.
2. Creditors: Banks, financial institutions, or suppliers providing credit to the business would use the financial statements to evaluate the creditworthiness of the company. They analyze the financial health and repayment capacity of the business before extending loans or granting credit terms.
3. Potential Investors: Individuals or entities considering investing in the business would rely on the financial statements to assess the financial viability and potential return on investment. They evaluate the profitability, growth prospects, and financial stability of the company before making investment decisions.
4. Regulatory Authorities: Government agencies and regulatory bodies may require the financial statements to ensure compliance with tax laws, accounting standards, and other regulatory requirements. They use the financial information to assess the business's compliance and financial reporting accuracy.
Regarding the calculation of relevant materiality amounts for the audit, the engagement partner has asked for the following:
1. Materiality: Materiality is the level of misstatement in the financial statements that could influence the economic decisions of the users. It is typically expressed as a percentage of a specific benchmark, such as net income before tax. To calculate materiality, the auditor would consider factors such as the size, nature, and risk of the business.
2. Performance Materiality (PM): Performance materiality is a lower threshold of materiality set by the auditor to plan the extent of audit procedures. It is typically set at a lower percentage than materiality and is used to assess the overall misstatement in the financial statements.
3. Acceptable Misstatement in Performance Testing (AMPT): AMPT is the amount set by the auditor to evaluate whether the uncorrected misstatements identified during the audit are within the overall materiality threshold. It helps determine the acceptability of misstatements that are considered immaterial individually but may be material when aggregated.
To calculate these amounts, the auditor would consider factors such as the company's size, industry, risk profile, and other relevant circumstances. The auditor would typically use professional judgment and experience to determine appropriate percentages for materiality, performance materiality, and acceptable misstatement in performance testing based on the specific characteristics of the business.
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write a short response paragraph explaining how a credit score could contribute to keeping someone caught in a cycle of poverty
Answers
Answer:
A credit score is a numerical representation of a person's creditworthiness, which lenders use to determine their ability to repay loans. Unfortunately, people with low credit scores may find it difficult to access credit, which can make it challenging to obtain loans to start a business, purchase a home, or cover emergency expenses. This lack of access to credit can make it challenging for people caught in the cycle of poverty to break free, as they may not have the resources to address urgent financial needs or invest in income-generating opportunities. Additionally, without access to credit, they may turn to predatory lenders or high-interest credit cards, further perpetuating the cycle of poverty. Therefore, a low credit score can contribute to keeping someone caught in a cycle of poverty by limiting their financial options and making it difficult to improve their economic situation.
Explanation:
What is the share of ownership in a corporation called?
Answers
The share of ownership in a corporation is called a "stock" or a "share." A stock represents a portion of ownership in a company and is typically represented by a physical or digital certificate.
When a person buys a stock in a corporation, they become a shareholder and are entitled to a portion of the company's profits, as well as voting rights on important company decisions. The value of a stock can fluctuate based on various factors, including the performance of the company and market conditions.
Shareholders can also buy and sell their shares in the stock market, allowing them to potentially profit from changes in the stock's value. Overall, owning stocks is a way for individuals to invest in companies and participate in their growth and success.
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I need help please n thanks
Answers
Answer:
The first foundation is called THE foundation You need to maintain a accurate balance so you can keep track
Explanation:
what is the most common category in superindustry? use sort and table to find this answer.
Answers
The most common category in the superindustry can be found by sorting and tabulating the data. To do this, first sort the data by category. Then, count the number of each category and create a table that displays the results. The category with the most entries will be the most common category in the superindustry.
The most common category in superindustry is the one with the highest frequency or count. To find this answer, we can use the sort and table functions in Excel or another spreadsheet program.
Step 1: Create a table with the categories in one column and the frequency or count in another column.
Step 2: Use the sort function to sort the table by the frequency or count column in descending order.
Step 3: The first category in the sorted table will be the most common category in superindustry.
Here is an example:
| Category | Frequency |
|----------|-----------|
| A | 5 |
| B | 3 |
| C | 8 |
| D | 2 |
After sorting by the frequency column in descending order, the table will look like this:
| Category | Frequency |
|----------|-----------|
| C | 8 |
| A | 5 |
| B | 3 |
| D | 2 |
Therefore, the most common category in superindustry is category C.
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can anybody help me please i will mark brainlyest
Answers
and electrical light
Explanation:
telephone: it allowed for instant
communication, communication by voice,
and it paved the way for future inovations
in telephone technology.
engine: it was powered by gas and air,
which made it impractical for widespread
public use.
light: Electric lights allowed factories to stay
open longer and produce more goods.
Which document should a job seeker send with a résumé to a potential employer?
Answers
Answer:
c). cover letter
Explanation:
A cover letter is a formal letter or document that a job seeker sends to a potential employer together with a resume. The letter details the positions that the vacant applicant seeks to fill. The cover letter or job application letter accords the applicant the opportunity to market themselves to the employer.
In the cover letter, a job seeker states why they are the best candidate for the position. Applicants use the cover letter to convince the employer to hire them.
Answer:
cover letter
Explanation:
Explain the importance of office for an organization long answer
Answers
Answer:
The answer to this question is given below in this explanation section.
Explanation:
" importance of office for an organization"
An office is the center point of organization.It is a place to perform different activities of a business organization.The office is the brain of the whole organization.The office performs a critical function such as information collection,collection,recording analyzing distribution of information and executive function such as planning,organization,policies formulation,decision making etc.
It is used by management for the purpose of planning,organizing,staffing,directing,and controlling.Office not only keep record of information but also pay the role of reliable channel of communication the information.It is required for smooth functioning of the organization.
Proper organisation facilities the intensive use of human capital.Organization stimulates creativity.By providing well defined areas of work and ensuring delegation of authority,Organization provides sufficient freedom to the managers and encourages their initiative,independent thinking and creativity.
Help, can someone tell me if this memo is ineffective or effective?
(This is an example)
Answers
Answer: It is ineffective
Explanation:. Because it has no meaning its just someones opinion its not really anything that involves inportant stuff hope this helps :)