The federal funds rate falls , because the supply of the bank reserves increases
Answer: Option (C) is correct.
Explanation:
Correct option: The price level and nominal wages.
According to the classical dichotomy, nominal variables moves proportionately with the quantity of money whereas real variables remains unchanged.
A classical model that is based on the flexibility of prices and wages, conclude that any changes in money supply only affects the nominal variables whereas real variables remains constant. This theory results in the independence of the real variables from any changes in the money supply and nominal variables.
Inflation is the economic condition in which the interest rate keeps increasing which is beneficial for the lenders. But not a fixed rate lender.
<h3 /><h3>What is Interest Rate?</h3>
Interest rate is the prevailing market rate which the lender of the money gets in return for the money provided as a loan.
If there is a fixed interest contract the lender will get the same percentage of return for the duration of contract, no matter the fluctuation of the interest rate in the market. This is not beneficial when the economy is facing inflation. As whatever be the rate in the market (definitely higher) the lender will get the same percentage of return.
However if there is a variable rate contract the rate is updated and the lender is paid at the updated interest rate. This is beneficial when the economy is facing inflation.
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Both the direct method and the indirect method. Cash from operating activities usually introduces to the net cash arrival reported in the first section of the explanation of cash flows. Cash flow from operating activities also includes changes in working capital, such as increases or decreases in inventory, short-term debt, accounts receivable and accounts payable.
Answer: Option B
Explanation: Safeguarding inventory refers to keeping proper records of inventory and protecting it from any kind of damage that may result in loss to the organisation.
The main objective behind safeguarding inventory is to minimize loss of the organisation that is keeping it.
In the given case, second option is the purchase return and it could not be considered a default of the purchaser of inventory.
Hence from the above we can conclude that the correct option is B.
