Answer:
c. increasing the money supply. To increase the money supply it could buy bonds.
Explanation:
In the case when fed wants to decreased the rate related to the federal funds so here the money supply should be increased also in order to increased the money supply we need to purchased the bonds
Moreover, the increase in money supply should be equivalent to the reduction in the interest rate
Therefore the option c is correct
Answer:
$5,007.72
Explanation:
Present value is the sum of discounted cash flows.
Present value can be calculated using a financial calculator.
Cash flow each year from year one to five = 0
Cash flow each year from year six to fifteen = $1000
I = 7%
Present value = $5,007.72
To find the PV using a financial calacutor:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. After inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.
3. Press compute
I hope my answer helps you
Answer:
maximum profit = 10500
Explanation:
The newsvendor model is a statistical model used to manage inventory and determine the appropriate amount of inventory. So first of all we determine the optimal inventory level then we use it to find maximum profit. In order to determine optimal inventory level we first have to find possible variability in demand, for that we use the critical fractile formula which is as follows:
f= cu/cu+co
cu= underage cost = price - cost = $25 -$10 = $15
co= overage cost = cost - salvage value = $10 -$5 = $5
f= 15/15+5
f= 0.75
If we look at the standard normal cumulative distribution table 0.75 is equal to z= 0.67.
Q = Mean+ (z* standard deviation)
Optimal inventory = 500 + (0.67* 300)
Optimal inventory = 701 units
WE ROUND OFF THE UNITS TO 700.
Now we calculate maximum profit as follows:
maximum profit = contribution * Q
maximum profit = ($25 - $10) * 700
maximum profit = 10500
Answer: B. Government intervention.
Explanation:
A Drive-through bar could be very profitable as it involves people simply pulling up to a window, ordering alcohol and driving away with it. It is not very workable though because it is dangerous.
Drinking and driving is one of the highest causes of road accidents and a drive-through bar is literally encouraging people to do that. The government has therefore intervened by enacting laws to limit the trading of liquor in such ways so as to reduce the instance of road accident.