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Levart [38]
3 years ago
5

Suppose the money supply (as measured by checkable deposits) is currently $700 billion. The required reserve ratio is 25%. Banks

hold $175 billion in reserves, so there are no excess reserves.
The Fed wants to increase money supply by $44 billion, to $744 billion. Assume that you can use the simple money multiplier
a) If the Fed wants to increase the money supply through open market operations, it should_ $_ billion worth of U.S. government bonds.
b) If the Fed wants to increase the money supply by adjusting the required reserve ratio, it should_required reserve ratio.
Business
1 answer:
coldgirl [10]3 years ago
5 0

Answer:

a) Buy bonds worth 44$ billion

b) Decrease

Explanation:

a) If the Fed wants to increase the money supply through open market operations, it should Buy bonds worth 44$ billion of U.S. government bonds.

b) If the Fed wants to increase the money supply by adjusting the required reserve ratio, it should Decrease required reserve ratio.

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Costello Corporation reported pretax book income of $500,900. During the current year, the reserve for bad debts increased by $6
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Answer:

Deferred income tax expense = $7,161

Explanation:

Given:

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Computation:

Assume tax rate = 21%

Taxable difference = 40,900 - 6,800

Taxable difference = 34,100

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3 years ago
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Answer:

they provide incentives for firms to develop technologies that are less polluting.

Explanation:

Pollution can be defined as the physical degradation or contamination of the environment through an emission of harmful, poisonous and toxic chemical substances.

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This ultimately implies that, it can be described as a program that allows new firms to pay existing firms to reduce their emissions below a standard.

Free market in tradable pollution permits simply means giving manufacturing companies and individuals the legal right to pollution of the environment. For example, XYZ company is purchasing the permit of 500 units of carbon dioxide (CO2) pollution annually, this simply means it is permitted to pollute the environment by 500 units of CO2 annually.

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3 0
3 years ago
How frequently is the value of an insurer's variable subaccounts normally calculated?
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8 0
3 years ago
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An investor purchased on margin Orange Computer for $30 a share. The stock's price subsequently increased to $50 a share at whic
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Answer:

A. 104%

B. 66.7%

Explanation:

A. Calculation for what would be the percentage return earned

Percentage return =($50-$30-30*60%*7%)/30*60%

Percentage return(20-$18*.07)/18=

Percentage return=1.04*100

Percentage return=104%

Therefore what would be the percentage return earned is 104%

B. Calculation for What would have been the return if the investor had notbought the stock on margin

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Percentage return=$20/$30

Percentage return=66.67 %

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Therefore What would have been the return if the investor had notbought the stock on margin is 66.7%

7 0
2 years ago
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