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hammer [34]
3 years ago
13

What role do individuals play in a capitalist system?

Business
2 answers:
Alekssandra [29.7K]3 years ago
8 0
Basically it's a free market economy, where we (the individuals) set the price of goods all based on supply and demand.
irakobra [83]3 years ago
3 0

Answer/Explanation:

The individuals take b solute control of the system.

Capitalism is an economic system found widely throughout the modern world, in which the economy is defined by private interests. This means that the government does not control the economy, but instead permits a free market that is defined by the infinite daily interactions of rational economic agents.

Cheers

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The risk-free rate is 7% and the expected rate of return on the market portfolio is 11%. a. Calculate the required rate of retur
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Answer:

Required rate of return= 14.8

If the security is expected to return 15%, it is underpriced.

Explanation:

The required rate of return on the security can be calculated using the CAPM formula which states that

Required rate of return =rf + B(rm  - rf)

where rf= risk free rate

          B= beta of the security

          rm = return on the market

Required rate of return = 0.07 + 1.92(0.11-0.07) = 14.68%

If the security is expected to return 15%, it is underpriced, and is a good investment. Discounting the expected cash-flows from the security at this higher expected return of 15% is going to yield a lower price compared to what the investor is prepared to pay given his required rate of return of 14.68%.

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The british economist john maynard keynes believed that recovery from the great depression required first abandoning the:
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John Maynard Keynes is known for his economic theory called Keynesian economics. He studied on ways to resolve the problem of the Great Depression. According to Keynes, the government should abandon or reduce tax rates, and at the same time, increase government spending as investments. By increasing government expenditures, it would open more job opportunities and investments into an economic zone. People will have high earnings, and because of lower taxes, they could buy what they want. For Keynes, this type of economic system called capitalism is the solution for the Great Depression.
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If the demand for loans increases, the interest rate will fall.<br><br> True or false
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Answer:

1. Increases in demand will increase both the interest rate and the total amount of borrowing and lending. Decreases in demand will decrease both the interest rate and the total amount of borrowing and lending.

Explanation:

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Example of unsecured loans include, student loan, personal loan, and credit cards.

The unsecured loan is not good because the APR is higher than the secured one reason being there is no assets which underlines for the creditor to stop if someone does not pay.

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