<u>Let's match each portfolio asset with its defintion</u>
- trading paper assets. It involves buying and selling of stocks, bonds, mutual funds, derivatives, and currencies. The paper asset is a representation of an underlying asset that can be of many types: stock, bonds, etc. Literally it is a piece of paper where the ownership of an asset is stated.
- stocks: It represents ownership in a corporation. The capital of such company is divided in equally-valued shares which are sold in the financial markets and the buyers become its owners in the proportion of the value of the shares they have purchased.
- mutual funds: It is a financial investment that pools money from investors to invest in securities. They have certain advantages if compared to investing individually on securities. They enable to reach economies of scale when conducting investments, they involve a higher level of diversification, more liquidity and they are controlled by professionals.
- derivative: It is a contract whose value derives from other financial assets. More specifically, its value depends on an underlying, which can be an asset, an index, etc. Derivative contracts can be issued with a multiplicity of objectives: to protect other investment against price variations (insurance), to speculate, etc.
Answer:
correct option is D raise the fed funds rate by 0.5% if inflation rises 1% above its target of 2%
Explanation:
solution
Taylor Rule is invented in 1992 and it is interest rate forecasting model
As the product of John Taylor Rule is the 3 number
- interest rate
- inflation rate
- GDP rate
and Taylor rule is that when GDP is equal to potential GDP and inflation rate is at its target rate of 2%
and the federal funds target rate should be 4%
so we can say here correct option is D raise the fed funds rate by 0.5% if inflation rises 1% above its target of 2%
I believe the answer is: <span>People are sometimes motivated to increase rather than decrease their level of stimulation.
</span><span>drive-reduction approaches is aimed to reduce humans' tendency to do a certain action/behavior by eliminating the need to seek the rewards that they might get by doing the behavior.
</span>For example,when trying to make a person display appropriate behavior to lose weight, drive reduction approach would include things that would eliminate that person's appetite.