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sdas [7]
3 years ago
9

Suppose the Fed purchases $100 million of U.S. securities from security dealers. If the reserve requirement is 20 percent, the c

urrency holdings of the public are unchanged, and banks have zero excess reserves both before and after the transaction, the total impact on the money supply will be a:A. $100 million increase in the money supply.B. $100 million decrease in the money supply.C. $200 million increase in the money supply.D. $500 million increase in the money supply.
Business
1 answer:
Alja [10]3 years ago
7 0

Answer:

Option (D) is correct.

Explanation:

Given that,

Amount of securities purchased = $100,000,000

Reserve requirement ratio = 20 percent

Money multiplier:

= 1 ÷ Reserve requirement ratio

= 1 ÷ 0.20

= 5

Increase in money supply:

= Money multiplier × Amount of securities purchased

= 5 × $100,000,000

= $500 million

Therefore, the total impact on the money supply will be a $500 million increase in the money supply.

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Mayfield Company sells two products, Blue models and Plaid models. Blue models sell for $43 per unit with variable costs of $30
alekssr [168]

Answer:

Break-even point in total units=  951.7units

Explanation:

<em>Break-even point is the level of activity at which a firm must operate such that its total revenue will equal its total costs. At this point, the company makes no profit or loss</em>.

It is calculated using this formula:

<em>Break-even point (in units) = Fixed cost/ average contribution per unit</em>

                                                          <em>  Blue                          Plaid</em>

Contribution per unit                43-30 = 13                   52-45 = 7

<em>Average contribution per unit </em>

= ( (13× 4) + (7×5) )/9

= $ 9.66 per unit

<em>Break-even point in total units</em>

= $9200/$ 9.66

= 951.7units

Break-even point in total units= 951.7units

           

6 0
3 years ago
Cindy earned a 10 percent increase in her salary and received the entire increase at the beginning of the year, with the stipula
sammy [17]

Answer:

Lump-sum salary increase.

Explanation:

A lump-sum salary increase is an amount paid instead of increase in salary. It is not added to the fixed base salary, it is instead given in the form of a single cash payment, as it is the case with Cindy here. This is why it is also known as lump sum bonus, because it is given as a single payment, as it was in Cindy’s case, all given at the beginning of the year.

7 0
3 years ago
“Gambler fallacy” is the Believe that if people keep gambling they will eventually win big
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2 years ago
The five restaurants in your town have monthly rent costs of: $6,350, $5,745, $11,870, $15,255, &amp; $26,432. What is the mean
Temka [501]

Answer:

$13,130.4

Explanation:

Mean is a measure of average. It is used to calculate the average of a given set of data.

Mean = Sum of Terms/Number of Terms

Monthly Mean Rental Cost = Total rental cost / Number of rents

= ($6,350 + $5,745 + $11,870 + $15,255, + $26,432)/5

= $65652/5

=$13,130.4

7 0
3 years ago
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