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ruslelena [56]
3 years ago
14

Suppose a new and more liberal Congress and administration are elected. Their first order of business is to take away the indepe

ndence of the Federal Reserve System and to force the Fed to greatly expand the money supply. What effect will this have on your organization and/or industry? What about interest rates and the general consumer? Would you support or oppose such an expansion? Why?
Business
1 answer:
Anni [7]3 years ago
7 0

Answer:

Check the answer below.

Explanation:

The Fed would increase the money supply by ordering trading desk at the Fed to purchase securities from the govt. securities market dealers, these dealers would sell the securities to the Fed traders for money, this money goes into the dealers deposits at different depository institutions (banks) therefore the money supply in form of deposits shall increase in these depository institutions.

The result is large money deposits at the depository institutions as a result of which these depository institutions would reduce the interest rate at which to lend these excess money ,as the demand for the loans is lesser as compared to supply(large money in deposits)the depository institutions would decrease the interest rates to adjust the equilibrium between the demand and supply of the loan so that the demand matches the supply and that adequate loans are provided as per the large money deposits at these institutions.

The general consumer would now have more free access to the money as he can borrow money from the banks at a cheaper rate so that the more money is available to him for spending.

The organisation or industry would have easy access to loans so that now greater finance is available at a cheaper rate, the industry borrowing would increase on account of less interest rates and with these larger borrowings more profitable investments opportunities can be executed which would ultimately mean that the growth of the industry would increase.

It depends on the state of the economy whether there is a recession or a stable economy or a growth phase, it also depends on whether Fed would want to fuel the growth engine or want to cool the economy to a stable level. If the conditions are recessionary then I would definitely support the expansion because these action of expanding money supply is necessary to fuel growth if not long term then shorter term at least, larger money supply would increase spending power of consumers who would increase the demand so that the industry output shall increase and bring the economy to growth phase again.

If the conditions are such that Fed feels like the economy is overheated or that there is excessive growth than demanded then I would oppose such an expansion in fact it would be wise to curb the money supply and halt the expansion to a stable level. If the conditions are normal then it’s up to Fed to decide when to increase and decrease the money supply as per there growth outlook I would be unbiased to either expansion or non-expansion of money supply.

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Suppose that Spain and Sweden both produce fish and wine. Spain's opportunity cost of producing a bottle of wine is 4 pounds of
Darya [45]

Answer:

A) 9 Pounds of Fish Per Bottle of Wine

Explanation:

A few things should be explained

1. Opportunity Cost - this is the benefit or value of the next best choice that has to be sacrificed when a choice is made between several alternatives.

2. Comparative Advantage: This describes the advantage when a business, individual or even a nation is able to maunfacture a good or offer a service at an opportunity cost that is lower than other competitors in the business. It simply means the ability to produce a good or service at a cost cheaper than one's competitors.

Step 1: By comparing the opportunity cost of producing wine in the two countries, you can tell that Spain (ability to produce a bottle for 4 pounds of fish as compard to 10 pounds by Sweden) has a comparative advantage in the production of wine

Also Comparing the opportunity cost of wine as well, Sweden has the comparative advantage in the production of fish (10 pounds of fish as compared to 3 pounds that can be produced by Spain for a bottle of while).

Step 2: The Trading of wine and fish between Spain and Sweden

a) as long as Spain is able to get more than 4 pounds of fish (what it can produce) for every exported bottle of wine, then it can gain from a trade with Sweden.

b) Also , as long as Sweden is able to receive more than 1/10 bottles of wine for each pound of fish it exports to Spain, it can gain from the specialization and trade.

Step 3: Prices of trade (of wine in terms of fish) will allow both Sweden and Spain gain from Trade.

The correct answer is 9 Pounds of Fish per bottle of Wine. This is correct because Spain can get more than the minimum 4 pounds of fish it needs and Sweden can receive more than 1/10 the bottles of wine it needs to make a gain.

5 0
3 years ago
Annapolis Company has two service departments (Computer Operations & Maintenance Services). Annapolis has two production dep
eimsori [14]

Answer:

$56,900

Explanation:

                             Compt.         Maint.       Mixing      Packaging

Dept Cost             140,000      115,000

Cost allocation                            32941        41177         65882

(Computer)

Cost allocation                                

(Maintenance)                                                56900          91041

Total                                                                98077         156923

Workings.

Computer department cost allocation

Maintenance department = 4/17*140000 =32941

Mixing department = 5/17*140000 =41177

Packaging department = 8/17*140000= 65882

Maintenance department cost allocation

Total cost allocated = 147941

Mixing department = 5/13*147941 = 56900

Packaging department  = 8/13*147941 =91041

8 0
3 years ago
It is ultimately up to the buyer to avoid fraud.
11111nata11111 [884]
That statement is True

Frauds are gonna exist, no matter what country you're in

No matter how many frauds are there that exist around, if you're smart enough to recognize it , you won't fall into the fraud

Otherwise, no matter how hard the Governments' work to reducing the amount of frauds around you, if you're unaware and gullible, there's a pretty high chance you're gonna fall to one


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3 years ago
At a movie the ater box office, all tickets are pre-numbered. At the end of each day, the beginning ticket number is subtracted
Mrrafil [7]

Answer:

A. Some customers presented tickets purchased on a previous day when there wasn't a ticket taker at the theater entrance.

Explanation:

The control of selling fresh prenumbered tickets from the last number sold on the previous day is a control that detects tickets sold the previous day.

If tickets were sold on the previous day, they can be reused today. So having a unique number on them is an ideal way to monitor the range of tickets issued today.

Only those within the range will be allowed to enter the theatre.

4 0
3 years ago
What makes you buy a candied vegetable or a candied fruit?
Leviafan [203]

Answer: Your curiosity on whether it tastes like any other candy or not.

Explanation:

8 0
3 years ago
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