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2 years ago

What are the three roles of money in an economy

Business

1 answer:

Free_Kalibri [48]2 years ago

5 0

The three functions/roles of money in an economy are:

1) Medium of Exchange: When money are used to intermediate exchange of goods and services.

2) Unit of Account: Standard numerical unit of measurement of market value goods, services, or other transaction. Money must be divisible into smaller units without loss of value and a specific weight or size to be verifiably countable.

3) Store of Value: To act as a store value,money should be reliably saved, stored, and retrieved. It also must be predictably usable as a medium of exchange when it is retrieved.

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Honduras is a small economy in central america. it keeps a fixed exchange rate with the us. capital is perfectly mobile. you may

rosijanka [135]

Answer:

Given that Honduras is a small economy in Central America, and it keeps a fixed exchange rate with the US, and capital is perfectly mobile, but interest rates are three percent in the US and six percent in Honduras, the explanation of the difference in these interest rates are as follows:

Honduras has a higher interest rate, meaning that its sovereign bonds pay higher values than the American ones, as well as its banks also pay higher interests on their investments compared to American banks.

This is so for a double reason: on the one hand, because the Honduran economy is less reliable than the American economy, which is larger and therefore more solvent and capable of overcoming eventual crises, with which the risk of default is less.

On the other hand, the Honduran economy is more dependent on foreign investment, so it must offer higher interest rates to attract such investments.

5 0

2 years ago

if Alexis invest $2,000 into a fund that earns 5.5% interest compounded annually, how long will it take for her investment to gr

madreJ [45]

Answer:

73 years

Explanation:

To solve this problem, we can use the formula for the annual compound interest, which is:

$A=P(1+r)^t$

where:

A is the final amount after time t

P is the principal

r is the rate of interest

t is the time

In this problem, we have:

$P=\$2000$ is the principal

$r=0.055$ is the interest rate (5.5%)

We want to find the time t at which the amount of money is

A = $100,000

Therefore, we can re-arrange the equation and solve for t:

$(1+r)^t=\frac{A}{P}\\t=log_{1+r}(\frac{A}{P})=log_{1+0.055}(\frac{100,000}{2000})=73$

So, it will take 73 years.

3 0

3 years ago

When corruption is evident in governments the result is that

valentinak56 [21]

Answer: Industries have more difficulty opening since they will have to resort to bribes from government people.

Explanation: When corruption is very marked in a country, many people know that the way to obtain benefits is through certain bribes. In the case of industries, in order for them to open they have to resort to bribes made by government personnel to have the opportunity for their construction to take place.

8 0

3 years ago

Anthony Roofing's budgeted manufacturing costs for 50,000 squares of shingles are: Fixed manufacturing costs $30,000 Variable ma

liberstina [14]

Answer:

Total budgeted manufacturing cost = $824,000

Explanation:

The total budgeted manufacturing cost is the sum of the variable and fixed manufacturing cost

The fixed manufacturing cost of $30,000 would be absorbed (i.e charged to the units produced using overhead absorption rate (OAR).

OAR = Budgeted fixed manufacturing cost / Budgeted production squares

= $30,000 / 50,000 squares = $0.6 per square

Absorbed fixed manufacturing cost= OAR × actual production of squares

Absorbed fixed manufacturing cost= $0.6 × 40,000 = $24,000

Variable manufacturing cost = $20.00 × 40,000 =800,000

Total budgeted manufacturing cost = $24,000 + $800,000 = $824,000

Total budgeted manufacturing cost = $824,000

5 0

3 years ago

Annual depreciation rates are (a) buildings (4%) (b) equipment (10%). Salvage value is estimated to be 10% of cost.

GrogVix [38]

Answer:

depreciation expense 5,800 debit

acc dep - building 4,320 credit

acc dep - equipment 1,480 credit

<u>Missing information</u>

GRECO RESORT TRIAL BALANCE AUGUST 31, 2014

Buildings 120,000 Equipment 16,000

Explanation:

First, calcualte the depreciable amount:

cost less salvage value:

120,000 - 10% = 120,000 * (1 - 0.1) = 108,000

Now we multiply this by the depreciation rate which represent 1/useful life

108,000 x 4% = 108,000 x 0.04 = 4,320

We do the same with the equipment

16,000* (1 - 0.1) = 14,800 amount subject to depreciation

14,800 * 10% = 14,800 x 0.1 = 1,480

he adjusting entry will debit the depreciation expense and increase the accumulated depreciation of eahc asset

6 0

2 years ago