The reasons for firms do not want to issue new shares of stock when consumers or businesses are negative about the economic conditions.

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Answer 1

Question

Chapter 13, Problem 1P

To determine

To explain:

The reasons for firms do not want to issue new shares of stock when consumers or businesses are negative about the economic conditions.

Expert Solution & Answer

Explanation of Solution

The share prices are likely to fall when consumers or businesses are pessimistic about economic conditions. So,if there is a situation where consumers or businessmen are pessimistic, the firms should issue a larger number of stocks to raise some funds. Likewise, these firms are apt to spend in new capital or new expenditure when economic conditions are not in support of them.

Economics Concept Introduction

Stock:

The ownership on a company's assets and earnings in form of share is known as stock. The person having share can claim ownership for that part.

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Short Description Fiscal Policy Graph Details Shown is a Fiscal Policy diagram with the variable Real GDP (billions of dollars) on the x-axis and the variable Price Level on the y-axis. The x-axis is scaled from 0 to 800 billion dollars with an increment of 40 billion dollars, and the y-axis is scaled from 30 to 150 units with an increment of 5 units. Object Details On the graph we have:Four Line Objects:An upward sloping Aggregate Supply, AS line with two endpoints:Point 1 at (160, 70)Point 2 at (720, 140)A downward sloping Aggregate Demand, AD1 line with two endpoints:Point 1 at (80, 110)Point 2 at (640, 40)A vertical Long-run Aggregate Supply, LRAS with two endpoints:Point 1 at (400, 145)Point 2 at (400, 30)A downward sloping Aggregate Demand, AD line with two endpoints:Point 1 at (720, 60)Point 2 at (160, 130)Two Reference Points:Lines AS, AD, and LRAS intersect at (400, 100)Lines AS and AD1 intersect at (280, 85) a. How much does aggregate demand need to change to restore the…

Fiscal Policy Graph Details Shown is a Fiscal Policy diagram with the variable Real GDP (billions of dollars) on the x-axis and the variable Price Level on the y-axis. The x-axis is scaled from 0 to 1000 billion dollars with an increment of 50 billion dollars, and the y-axis is scaled from 0 to 180 units with an increment of 10 units. Object Details On the graph we have:Four Line Objects:An upward sloping Aggregate Supply, AS line with two endpoints:Point 1 at (200, 40)Point 2 at (800, 160)A downward sloping Aggregate Demand, AD line with two endpoints:Point 1 at (200, 160)Point 2 at (800, 40)A downward sloping Aggregate Demand, AD1 line with two endpoints:Point 1 at (350, 170)Point 2 at (900, 60)A vertical Long-run Aggregate Supply, LRAS line with two endpoints:Point 1 at (500, 170)Point 2 at (500, 0)Two Reference Points:Lines AS and AD1 intersect at (600, 120)Lines AS, AD, and LRAS intersect at (500, 100) a. How much does aggregate demand need to change to restore the…

a. How much does aggregate demand need to change to restore the economy to its long-run equilibrium? $ billion b. If the MPC is 0.6, how much does government purchases need to change to shift aggregate demand by the amount you found in part a? $ billion Suppose instead that the MPC is 0.95. c. How much does aggregate demand and government purchases need to change to restore the economy to its long-run equilibrium? Aggregate demand needs to change by $ billion and government purchases need to change by $ billion.

Answer 2

Question

Chapter 13, Problem 1P

To determine

To explain:

The reasons for firms do not want to issue new shares of stock when consumers or businesses are negative about the economic conditions.

Expert Solution & Answer

Explanation of Solution

The share prices are likely to fall when consumers or businesses are pessimistic about economic conditions. So,if there is a situation where consumers or businessmen are pessimistic, the firms should issue a larger number of stocks to raise some funds. Likewise, these firms are apt to spend in new capital or new expenditure when economic conditions are not in support of them.

Economics Concept Introduction

Stock:

The ownership on a company's assets and earnings in form of share is known as stock. The person having share can claim ownership for that part.

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Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 3

Question

Chapter 13, Problem 1P

To determine

To explain:

The reasons for firms do not want to issue new shares of stock when consumers or businesses are negative about the economic conditions.

Expert Solution & Answer

Explanation of Solution

The share prices are likely to fall when consumers or businesses are pessimistic about economic conditions. So,if there is a situation where consumers or businessmen are pessimistic, the firms should issue a larger number of stocks to raise some funds. Likewise, these firms are apt to spend in new capital or new expenditure when economic conditions are not in support of them.

Economics Concept Introduction

Stock:

The ownership on a company's assets and earnings in form of share is known as stock. The person having share can claim ownership for that part.

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Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 4

Question

Chapter 13, Problem 1P

To determine

To explain:

The reasons for firms do not want to issue new shares of stock when consumers or businesses are negative about the economic conditions.

Expert Solution & Answer

Explanation of Solution

The share prices are likely to fall when consumers or businesses are pessimistic about economic conditions. So,if there is a situation where consumers or businessmen are pessimistic, the firms should issue a larger number of stocks to raise some funds. Likewise, these firms are apt to spend in new capital or new expenditure when economic conditions are not in support of them.

Economics Concept Introduction

Stock:

The ownership on a company's assets and earnings in form of share is known as stock. The person having share can claim ownership for that part.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Answer 5

Chapter 13, Problem 1P

To determine

To explain:

The reasons for firms do not want to issue new shares of stock when consumers or businesses are negative about the economic conditions.

Expert Solution & Answer

Explanation of Solution

The share prices are likely to fall when consumers or businesses are pessimistic about economic conditions. So,if there is a situation where consumers or businessmen are pessimistic, the firms should issue a larger number of stocks to raise some funds. Likewise, these firms are apt to spend in new capital or new expenditure when economic conditions are not in support of them.

Economics Concept Introduction

Stock:

The ownership on a company's assets and earnings in form of share is known as stock. The person having share can claim ownership for that part.

Answer 6

Chapter 13, Problem 1P

To determine

To explain:

The reasons for firms do not want to issue new shares of stock when consumers or businesses are negative about the economic conditions.

Expert Solution & Answer

Explanation of Solution

The share prices are likely to fall when consumers or businesses are pessimistic about economic conditions. So,if there is a situation where consumers or businessmen are pessimistic, the firms should issue a larger number of stocks to raise some funds. Likewise, these firms are apt to spend in new capital or new expenditure when economic conditions are not in support of them.

Economics Concept Introduction

Stock:

The ownership on a company's assets and earnings in form of share is known as stock. The person having share can claim ownership for that part.

Answer 7

Chapter 13, Problem 1P

To determine

To explain:

The reasons for firms do not want to issue new shares of stock when consumers or businesses are negative about the economic conditions.

Answer 8

Expert Solution & Answer

Explanation of Solution

The share prices are likely to fall when consumers or businesses are pessimistic about economic conditions. So,if there is a situation where consumers or businessmen are pessimistic, the firms should issue a larger number of stocks to raise some funds. Likewise, these firms are apt to spend in new capital or new expenditure when economic conditions are not in support of them.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

Economics Concept Introduction

Stock:

The ownership on a company's assets and earnings in form of share is known as stock. The person having share can claim ownership for that part.

Answer 12

Ch. 13 - Prob. 1P Ch. 13 - Prob. 2P Ch. 13 - Prob. 3P Ch. 13 - Prob. 4P Ch. 13 - Prob. 5P Ch. 13 - Prob. 6P Ch. 13 - Prob. 7P Ch. 13 - Prob. 8P Ch. 13 - Prob. 9P Ch. 13 - Prob. 10P

The reasons for firms do not want to issue new shares of stock when consumers or businesses are negative about the economic conditions.

To explain: The reasons for firms do not want to issue new shares of stock when consumers or businesses are negative about the economic conditions.

Explanation of Solution

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Chapter 13 Solutions

To explain:

The reasons for firms do not want to issue new shares of stock when consumers or businesses are negative about the economic conditions.