Calculate the External Financing Needed Given the Following Information: Current

question 364

Multiple Choice

Calculate the external financing needed given the following information: current sales = $25,000; current sales capacity = 80%; current fixed assets = $15,000; projected future sales = $40,000.

• A) $5,000
• B) $20,200
• C) $4,200
• D) $19,200
• E) $5,200

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Definitions:

Automatic Stabilizers

Economic policies and programs, such as unemployment benefits and progressive taxation, designed to automatically reduce volatility in the economy by offsetting fluctuations in economic activity without direct intervention by policymakers.

Government Deficit

The financial situation that occurs when a government's expenditures exceed its revenues within a specific time period, often leading to borrowing.

Jobless Recovery

A situation where the economy begins to recover from a recession, but the unemployment rate remains high or continues to increase.

Recognition Lag

Recognition Lag is the time delay between when an economic problem becomes apparent and when it is recognized by policymakers.