Question

How does federal debt effect the revenue for Campbell’s soup? How does household net worth effect...

How does federal debt effect the revenue for Campbell’s soup?

How does household net worth effect the revenue for Campbell’s soup?

Homework Answers

Answer #1

How does federal debt effect the revenue for Campbell’s soup?

  • In short run: in short run, uptick in the federal debt implies more demand in an economy. Rise in demand leads to the healthy sale of Campbell soup. Thus, overall revenue and profits of Campbell’s soup rise.
  • Long run: In long run, government may go for higher taxes to payoff past debts. Thus, it shall reduce demand for product of Campbell’s soup thereby causing fall in the revenue.

How does household net worth effect the revenue for Campbell’s soup?

  • Higher networth means consumers have strong economic condition. Thus, consumers are likely to consume more. Thus revenue of Campbell ,s soup would rise.
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