Answers A and E seem correct. B makes no sense. C makes no sense. and my renters insurance was very cheap vs property insurance.
You reply that "OMOs are the purchase and sale of government securities. To increase the money supply we will buy government securities which increases the amount of reserves in the banking system and fuels deposit expansion".
<u>Option: A</u>
<u>Explanation:</u>
The action of central bank to offer or take liquidity from or into a bank or a collection of banks in its exchange rate currencies is understood as an open market operation or OMO. The central bank is the only origin of such policy which may either purchase or sell the bonds of government on the open market or in what is now often the acceptable option, engage into a repo or protected lending agreement with a commercial bank: the central bank lend the monetary as a reserve over a given period of time and concurrently selects the qualified asset as security.
Here the Chair of the Federal Reserve Board explained OMO for the purpose of their use in the scenario of increasing money supply, by purchasing or selling the bonds or securities of public authorities to eligible bodies for the increment of assets in banking sector to drive the expansion of deposits.
Answer:
The firm has a return on equity of D. 4 percent
Explanation:
Return on equity (ROE) helps an investor see how much after-tax profit a company gained for each dollar in equity, is calculated by formula:
Return on equity (ROE) = Net income/shareholder's equity
The firm has net profits after taxes of $30,000 and common stockholders' investment of $750,000 - shareholder's equity.
ROE = ($30,000/$750,000) x 100% = 4.00%
