Thank you for reading this. I am looking for the clarification for the above-mentioned question.
This is the question:
If a population has a marginal propensity to save of 0.2 and the government injects $100m into the economy, how much additional expenditure will result?
The answer behind the notes is $500m.
My question is:
Shouldn't the $500m is the SUM of the expenditure and the $400m [SUM - initial expenditure] is the additional expenditure generated?
(since $100M is not "generated" but injected at the first place as the initial expenditure, shouldn't the "additional expenditure" be counted starting from Round 2)
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CIMA BA1 Lecture Notes > Chapter 1 > Test Question 5
4y ago#1I understand your point. However, the question asks how much additional expenditure will result not how much additional is generated.
Perhaps the question could be better worded.
Alright thank you very much!
hello, help
investment in associate account ( t-shape )
Balance b/d (2018) 120
Balance c/d (2019 170
Share of profit of associate company 40
According from above i need to know how to do the ledger. Normal there would be dividend received if we do in ledger but in this case if you see if i add 120+49 = 160 but 2019 is 170 so what about the remaining 110 . what is it ? answer in t shape
4y ago#4You need to repost on the appropriate forum...BA3 perhaps
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