Why is it important for investments to provide a greater return than the rate of inflation?
When inflation levels are stable and moderate, investors have lower expectations of high
market returns. Conversely, expectations rise when inflation is high. When inflation rises,
DO PRICES IN THE ECONOMY, leading investors to require a higher rate of return to maintain
their purchasing power.
Compounding is the process whereby interest is credited to an existing principal amount as well as to interest already paid. Compounding thus can be construed as interest on interest the effect of which is to magnify returns to interest over time, the so-called miracle of compounding.
The annual interest rate refers to the rate that is applied over a period of one year. Interest rates can be applied over different periods, such as monthly, quarterly, or bi-annually. However, in most cases, interest rates are annualized.
Monthly interest rate=2/12=0.1666%
So total deposit required=Amount/interest
=19/0.1666%
=19/0.00166
=11445
So option B is the correct statement
Learn more about Compounding here
brainly.com/question/24924853
#SPJ4
Answer:
In the period since the financial crisis of 2007-2009, inflation has been low in many countries, while a few experienced outright deflation. Why might unexpected deflation be of particular concern to someone managing a bank? Unexpected deflation is associated with (falling net worth) of borrowers, as the nominal value of their assets (falls) but the dollar amount of their liabilities (remains the same) . This weakens creditworthiness and can lead to (reduced) lending as asymmetric information problems worsen. In turn, ( reduced) credit supply can diminish economic activity, leading to (increased) defaults, a deterioration in the quality of the bank’s balance sheet and ultimately to bank insolvency.
Explanation:
Deflation is described as a period where there is persistent fall in prices of good and services, this affects different people like pensioners, lenders and borrowers in different ways.
Answer:
computer programmers
computer system Analysts
database administrators
network and computer systems administrators