All categories

4 years ago

When the Fed decreases the money supply, we expect

Business

1 answer:

tester [92]4 years ago

6 0

Answer:

b. interest rates to rise and stock prices to fall.

Explanation:

Interest rates are the prices of money (the cost to borrow money for use) so when money is scarce (decreased money supply) rates will rise.

When interest rates rise, people will cut down on spending and investment causing corporate earnings to decrease, causing the price of stocks to decrease.

You might be interested in

The U.S. Treasury offers to sell you a bond for $715.00. No payments will be made until the bond matures 15 years from now, at w

nalin [4]

Answer:

interest rate is 2.25 %

Explanation:

given data

sell bond = $715

bond matures = 15 years

redeem = $1,000

solution

we apply here formula that is

amount = principal × $(1+r)^{t}$ ................1

here put value and we get

1000 = 715 × (1+r)^{15}

$(1+r)^{15}$ = $\frac{1000}{715}$

solve it we get

r = 0.022617

so rate is 2.25 %

7 0

3 years ago

Mason bought a rotisserie in preparation for a party he was planning. When he put a chicken on the rotisserie, it would not rota

OlgaM077 [116]

Answer: Yes, although the salesperson did not make any express warranties, the UCC imposes an implied warranty of merchantability under which the rotisserie is guaranteed to be fit for the ordinary purposes for which it is used.

Explanation:

From the information given, we can infer that Mason has a recourse. Even though the salesperson did not make any express warranties, it should be noted that the UCC imposes an implied warranty of merchantability and hence, the rotisserie will be guaranteed to be fit for the purposes ordinarily for which it is used.

Therefore, the correct option will be D.

5 0

3 years ago

Merchandise inventory includes: (You may select more than one answer. Single click the box with the question mark to produce a c

LuckyWell [14K]

Answer:

A and C are correct. Other two are incorrect

Explanation:

3 0

4 years ago

Brown Co. pays weekly salaries of $10,500 on Friday for a five-day work week ending on that day. Assuming the end of the account

algol [13]

Answer:

Explanation:

The adjusting entry is shown below:

Wages Expense A/c Dr $6,300

To Wages payable A/c $6,300

(Being the wages are adjusted)

The computation is shown below:

= Five days salaries ÷ number of days in a week × given days

= $10,500 ÷ 5 days × 3 days

= $6,300

So, the wages expense is debited for $6,300 and wages payable is credited for $6,300

4 0

4 years ago

On January 1, Vermont Corporation had 40,000 shares of $10 par value common stock issued and outstanding. All 40,000 shares had

harkovskaia [24]

The journal entry, to record the sale of the treasury shares on February 1, would include:

a) debit to a loss account for $112,500

b) credit to Treasury Stock for $90,000

c) credit to a gains account for $112,500

d) debit to Treasury Stock for $90,000

Answer:

Option D Debit to Treasury Stock for $90,000

Explanation:

The journal entry of repurchase of treasury stock is as under:

Dr Treasury Stock $90,000

Cr Cash $90,000

As the treasury stock has been purchased for cash, the cash has been decreased and the decrease in treasury stock is credit in nature. Hence the decrease in stock is shown as debit and decrease in cash is shown as credit.

The rate as which the stock is purchased is the price at which treasury stock will be debited = Treasury shares purchased × Fair Value per Share

= 3,750 shares × $24

= $90,000

5 0

3 years ago