If the marginal propensity to consume is 0.80, and there is no investment accelerator or crowding out, a $100 billion increase in government expenditures would shift the aggregate demand curve right by O $500 billion, but the effect would be larger if there were an investment accelerator. O $600 billion, but the effect would be smaller if there were an investment accelerator. O $800 billion, but the effect would be larger if there were an investment accelerator. O $125 billion, but the effect would be smaller if there were an investment accelerator.

Answer the following question (Q#4)  Consider a poor country with an under-developed economy which could invest        trillions into its current capital stock – either moving “up” its current productivity              “curve” (PC) or shifting to a new and higher productivity (PC) curve.  Which        approach is likely best for increasing the country’s living standards (Real GDP         Per Person) through time? (a)  A continuous build-up of the current capital stock with established technology         will achieve more – capital “deepening” with more capital for each worker. (b) R&D that supports “cutting edge” invention and innovation will propel labor    (Q#8) Until recently, the economy in China has grown steadily due to the deliberate           emphasis on low skill – low wage factory labor methods.  However, China’s           economic standard of living is still comparatively low.  To achieve a U.S. or            German standard of living what should be done? a) China should…

Assume that the economy is in a mild recession, and as a result interest rates and money costs generally are relatively low. The WACC for two mutually exclusive projects that are being considered is 8%. Project S has an IRR of 20% while Project L's IRR is 15%. The projects have the same NPV at the 8% current WACC. However, you believe that the economy is about to recover, and money costs and thus your WACC will also increase. You also think that the projects will not be funded until the WACC has increased, and their cash flows will not be affected by the change in economic conditions. Under these conditions, which of the following statements is CORRECT? a. You should recommend Project S, because at the new WACC it will have the higher NPV. b. You should delay a decision until you have more information on the projects, even if this means that a competitor might come in and capture this market. O c. You should recommend Project L because it will have the higher IRR at the new WACC. d.…

solve it correctly. not use excel