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3 years ago

Explain why an unlimited printing of money would cause economic problems.

Business

1 answer:

Natali [406]3 years ago

6 0

Answer:

Unlimited printing of money will cause the problem of inflation.

Explanation:

Inflation is a general increase in the price of goods and services.

It can be caused by the following:

Demand-pull inflation - This type of inflation is caused by an excess demand for goods and services by consumers without commensurate supply from suppliers.

Cost-push inflation - This type of inflation is caused by an increase in the price of goods and services.

Lastly, out of others, I will like to discuss inflation caused by unlimited printing money.

I sometimes wonder why the country cannot just prompt money so that we can all be smiling and spending cash together. The fact is that this will reduce the purchasing power of money because it is in excess and ultimately leads to inflation.

When there is unlimited printing of money in a country, the cash in the circulation will be in excess, hence more money will be needed to buy few product. That is an indication of inflation.

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If workers in one part of the labor market unionize, then all else equal, we would expect the wages of unionized workers to ____

Vladimir [108]

If workers in one part of the labor market unionize, then all else equal, we would expect the wages of unionized workers to rise, and the wages of nonunionized workers to fall.

In developing countries, labor markets play a central role in determining economic and social progress. Employment status is one of the key factors in overcoming poverty. Ultimately, a decent, well-paid, and stable job is the most sustainable way to increase income and consumption.

Almost everything that happens in the economy affects the labor market. Changes in demand for goods and services, population size, and minimum wage rates can all have significant effects on the labor market. The economic change will probably have the greatest impact on the labor market as a whole.

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2 years ago

What role should government play in a free market economy?

igor_vitrenko [27]

Economists, however, identify six major functions of governments in market economies. Governments provide the legal and social framework, maintain competition, provide public goods and services, redistribute income, correct for externalities, and stabilize the economy.

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3 years ago

Read 2 more answers

Given a fixed supply of money and a downward sloping aggregate demand curve, an increase in money demand will ________ the price

Blizzard [7]

Money supply is the total amount of money in circulation which includes coins, cash and balance in savings account in a country at a period of time.

Given a fixed supply of money and a downward sloping aggregate demand curve, an increase in money demand will not change the price paid for its use, otherwise known as the discount rate.

A change the money supply in a country causes a change in aggregate demand.

An increase in the money supply causes increase in aggregate demand and a decrease in the money supply causes decrease in aggregate demand.

Therefore, an increase in money demand will not change the price paid for its use, otherwise known as the discount rate.

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3 years ago

The amount of interest you will earn in one year from a savings account is the _____.

Vitek1552 [10]

The Y in APY means yearly, the answer is APY

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3 years ago

First City Bank pays 6 percent simple interest on its savings account balances, whereas Second City Bank pays 6 percent interest

stiv31 [10]

Answer:

You will have $10,306 more

Explanation:

In this question, we are asked to calculate the difference in the amount of money we will earn if the same deposit amount is made in two different banks with different interest payment scheme

Firstly, Calculate the amount in the account as follows:

Future value = Interest + Amount = (Am ount x Period x Rate) + Amount = ($54,000 x 10 x 6%) + $54, 000 = $32,400 + $54,000 = $86,400

Therefore, the future value is

$86,400

Now, we calculate the amount by using the compounding as follows:

Future value = Amount x (1+ Rate)^n =

$54,000 * (1+0.06)^10

= $54,000 * 1.791 = $96,706

Therefore, the compound future value is

$96,706

The difference in amount is calculated as follows:

Difference in amount = $96,706 - $86,400 = $10,306

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3 years ago