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Anvisha [2.4K]
3 years ago
10

If inflation in the United States is 4% per year and in the United Kingdom it is 8% per year, and interest rate in the United Ki

ngdom is 6%, then the Fisher effect predicts that the interest rate in the United States is:
Business
2 answers:
mihalych1998 [28]3 years ago
3 0

Answer:

The correct answer is 2%.

Explanation:

The fisher effect describes the relationship between interest rates in two countries and the exchange rate of their currencies. In this example, it is said that the difference between the interest rate vs the inflation of the united group shows a difference of 2% that the United States is also expected to experience with an annual inflation rate of 4%.

Ronch [10]3 years ago
3 0

Answer:

2%

Explanation:

Given:

  • Inflation in the United States is 4%
  • Inflation in the UK is 8%
  • Interest rate in the United Kingdom is 6%

As we know:

Nominal interest rate = Inflation rate + Real interest rate

Let analyse the nominal interest rate in the UK

<=> Real interest rate = 6% - 8% =- 2%

Then the Fisher effect predicts that the interest rate in the United States when applying the global interest rate is:

= Nominal interest rate = Inflation rate + Real interest rate

= -2% + 4%

= 2%

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The  total amount of social insurance taxes you owe the federal government is $3,596.

The social insurance taxes will be tax rate (6.2%) of gross income amount of  $58,000 which is calculated using this formula

Social insurance taxes=Social security tax rate× Gross income

Where:

Social security  tax rate=6.2%

Gross income=$58,000

Let plug in the formula

Social insurance tax=6.2%×$58,000

Social insurance tax=$3,596

Inconclusion the  total amount of social insurance taxes you owe the federal government is $3,596.

Learn more here:brainly.com/question/10714904

3 0
2 years ago
The Borio Company had an asset with an $8 book value and a $7 market value; it decided to distribute the asset as a property div
ankoles [38]

Answer:

The net income will decrease and also the total assets will also decrease

Explanation:

Here, we want to know the combined effect on net income and total assets of company that made a decision of distributing assets as a property dividend.

As the asset value is down the entry is asset (credit) and loss on asset (debit)

This will effect the net income as it will come down and total assets value also come down

7 0
3 years ago
Through a process called _______, marketers collect and evaluate information about the marketing environment.
OverLord2011 [107]

Answer:

<em>Through a process called </em><em><u>environmental</u></em><em><u> </u></em><em><u>scanning</u></em><em> marketers collect and evaluate information about the marketing environment.</em>

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3 0
2 years ago
Pl lumber stock is expected to return 22 percent in a booming economy, 15 percent in a normal economy, and lose 2 percent in a r
LekaFEV [45]
                    Expected rate of return           Probabilities
Booming                22%                                    5%
Normal                  15%                                   92%
Recession               2%                                     3%

The expected rate of return on this stock is solved by multiply each expected rate of return to its corresponding probability and getting the sum of all products.

Booming: 0.22 x 0.05 =  0.011
Normal:   0.15 x  0.92 = 0.138
Recession 0.02 x 0.03 =<u> 0.0006</u>
Sum total                     0.1496  or 14.96% is the expected rate of return on this stock

3 0
3 years ago
_____ has the ability to introduce methods in which government can use to assist in ensuring equity.
dezoksy [38]
Answer: Social Welfare

Hope this helped!
3 0
2 years ago
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