Answer:
Solow growth rate = growth rate of long run real GDP on LRAS = 3%.
Spending growth rate = 10%. Hence rate of inflation is 10% - 3% = 7%. This is because AD meets LRAS to determine a combination of Solow growth rate and inflation rate.
In the long run SRAS meets LRAS as well as AD. Hence, rate of inflation in long run equals the rate of expected inflation. Thus expected inflation is also 7%.
Answer:
Conversion value = $980
Explanation:
A convertible bond is that which gives the holder the option of converting the bonds to pre-determined number of ordinary shares at a particular time in future.
When faced with these options , a rational investor who maximizes return would opt for the option with the higher value.
Hence, we would compare the conversion value and the bond price
The conversion value would be the higher of the value of shares on conversion and the current price of the bond,
The conversion value can be worked as follows:
C= Price of share × Number of shares
C= $28× 35 = $980
Price of Bond =$975
A rational investor would convert.
Conversion value = $980
Answer:
It is important to review your bank account statement as it contains crucial financial information that can be useful for reconciling your books. Additionally,it offer timely alerts on potentially fraudulent activities and can help you avoid some banking charges.
Explanation:
Regularly reviewing your bank statement can aid you in avoiding some banking fees such as:
1. Minimum balance charges.Some accounts require a minimum balance at any given time.Failure to maintain the minimum balance which vary from bank to bank will attract a fee.
2.Overdraft charges.An individual can incur overdraft charges when you spend more money than is actually available in your bank account.
3.Returned deposit charge.This is the fee that one incurs when for a bounced cheque.
Answer:
Price elasticity of demand measures the sensitivity of a firm's revenues to changes in its product's price.
Explanation:
Price elasticity of demand measures the percentage of rise in the demand when a priced is lowered.
You can talk of elastic demand when the quantity changes more than the price.
Unit elastic when the quantity demanded change the same proportion of the change in the price.
And inleastic demand when the change in the quantity demanded is minor to change in the price.