The Bandeiras Corporation, a merchandising firm, has budgeted its activity for December according to the following information:

Response:

There will be an increase in equilibrium quantity, but the impact on equilibrium price remains uncertain.

Note:

Due to the scientists' discovery, demand for oranges will rise, as will the price.

Additionally, the introduction of new fertilizers will boost the supply of oranges, leading to a price decrease.

Taking both of these factors into account indicates that there will be a rise in equilibrium quantity, while the effect on equilibrium price cannot be determined.

Response:

The yearly average return stands at 9.6 %

Clarification:

Calculating the average return

Assuming the price per share is 100

                                                       Initial    Growth             Final

                                                         Value            %                   Value

Company A  50 % at 100                5,000              8 %                 5,400

Company B 30 % at 100                 3,000              12 %                3,360    

Company C 20 % at 100                  2,000             10 %                2,200

Total amounts                             10,000                                     10,960

To find the average return, take the increase in value over the base, divided by the base

10,960 -  10,000  =  960/ 10000  = 9.6 % average return

Data regarding U.S. GDP

a) The nominal GDP growth rate from 1996 to 2016 was

= (2016 nominal GDP - 2009 nominal GDP) / 2009 nominal GDP x 100

131.72%

b) The GDP deflator growth rate from 1996 to 2016 was 44.75%, derived as follows:

= (2016 GDP deflator - 1996 GDP deflator)/ 1996 GDP deflator x 100

= (105.93 - 73.18)/73.18 x 100

=44.75%

Clarification:

1. Data regarding U.S. GDP

Year   Nominal GDP     GDP Deflator (Billions of dollars) (Base year 2009)

2016            18,707           105.93

1996             8,073             73.18

2. As stated on wikipedia.com, "the GDP deflator (implicit price deflator) is a metric for the price level of all new, domestically produced, final goods and services within an economy for a given year."

3. Nominal GDP serves as a method of measuring a nation's economic productivity. It considers the current prices of goods and services, calculating the monetary value of products and services produced in an economy during a specific period.

4. The growth rate indicates the percentage change for a specific variable over a defined time frame. It is figured as the difference between the current year's variable and the base year’s variable, divided by the base year's variable, multiplied by 100.