I will recommend a contraction of the money supply by increasing the revenue ratio or discount rate or selling bond.
I will also recommend a contraction of the money supply which would reduce the lending ability of the banking system, increase the real interest rate and reduce investment spending, aggregate demand and inflation.
<h2>Further Explanation</h2>
Supposing I am a member of the board of governors and the economy is experiencing a sharp rise in the inflation rate, I will suggest to other members and recommend a contraction of the money supply by increasing the discount rate.
The discount rate refers to an interest rate that is charged when commercial banks borrow money from the Federal Reserve System.
Also, it is required of all banks in the United States to set aside a particular percentage of their deposits in reserve.
The Federal Reserve System was created in 1913 and it is the central bank of the United States. The structure of the Federal Reserve System is made of the Board of governors and 12 Federal Reserve banks
Some of the core functions of the Federal Reserve board include
- They regulate the money supply with monetary policy
- They control the affairs of the financial institutions
- They control the checking clearing procedures in both regional and national.
Learn more about the federal reserve system at:
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If Paddyland was a true market economy with no government interaction, then a scarcity of rice would mean that the price of rice would go up until the level of supply and demand evened out.
Answer: $10,746
Explanation:
Using Compound interest formula
A= p(1+r/n) *nt
A= final amount =?
P= initial principal =$8, 000
r = interest rate = 0.1
n= nob of times interest applied(3)
t=nob of times period elapsed (3)
A = 8,000 (1+0.1/3) *9
A = 8000 (3+0.1/3) *9
A= 8000 (3.1/3) *9
A = 8000 (1.0333) *9
A = 8000 × 1.34327
A= $10,746
Answer:
a. GDP will increase
b. No effect on GDP
c. GDP will increase
d. GDP will increase
e. GDP will rise
Explanation:
Gross domestic product is the total monetary value of all the finished goods produced in the country during a specific period. When a new house is constructed it will create value for the economy and GDP will rise but when an old house is resold again there is no addition in the monetary value so there will be no effect on GDP.
Answer: critical ratio
Explanation:
The priority rule which processes jobs according to the smallest ratio of due date to processing time is refered to as the critical ratio.
The critical ratio (CR) is typically used in sequencing work especially during projects or in organizations. For this sequencing, the job that has the lowest critical ratio will be the one that will have to be scheduled first for processing.
