Answer:
The increase in reserve will ultimately lead to an increase in the money supplied.
Explanation:
From the scenario under study, the bank is greeted with uncertain economic realities. To cope with this, the bank resolves that rather than lend out excess reserves, it should rather increase the percentage of deposits held as reserve from 10% to 25%. Thus, this leads to a multiplier effect. And the reserve ratio from the forgoing is 1 to 4. That is, 1/10 to 1/4. Meaning there's a reduction in multiplier effecf of 10 to 4. And looking critically, this is a reciprocal of the new reserve ratio of 1/4
When bank hold more reserve, the ripple effect is that the Fed would buy more bonds. To increase the money supply by $200, however, the Fed will need to get a bond of $50.
The implication of this is that the bank reserve will rise in same amount. But taking the multiplier effect into cognizance, a small multiplier will be occasioned in form:
$50 * 4= $200.
Effectively, we have increased the money supply by $200, owing to the multiplier effect.
Answer:
$1,000; $1,000
Explanation:
Given that,
Household saving = $300
Business saving = $700
Government purchases = $1,000
Government transfers and interest payments = $500
Government tax collections = $1,500
GDP = $5,000
Public saving:
= Government tax collections - Government purchases - Government transfers and interest payments
= $1,500 - $1,000 - $500
= $0
Private savings:
= Household saving + Business saving
= $300 + $700
= $1,000
National savings:
= Public saving + Private saving
= $0 + $1,000
= $1,000
Answer:
Option D (profitability index) is the correct choice.
Explanation:
Options aren't mentioned in the issue above. Please find the full query attachment here.
Capital budgeting seems to be the mechanism whereby the creditors assess the value of a future investment project. This corresponds to something like the timeframe by which the planned project can produce adequate income to regain the original investment.
<u>The 3 most prevalent frameworks to contractor choosing are given below:</u>
- Payback period.
- Net present value.
- Internal rate of return.
Some other choices have no relation with the specified scenario. So that the option here is just the appropriate ones.
A couple of ways that business can use to get the informaiton are:
- By collecting Customer relation Management Data
This data is useful to know the satisfaction level of the customer and their tendency to return and repeat the purchase
- By observing the inventory
This includes observing the rate of inventory turnover to create a pattern that might be repeated for the following year.
Answer:
9.90%
Explanation:
The appropriate approach is to include the amount expected to kept in non-interest bearing account as part of the loan
total loan=$400,000/0.95= 421,052.63
Interest charge = 421,052.63*9%*6/12=$18,947.37
interest rate percentage=$18,947.37/$400,000=4.74%
Effective annual rate=(1+4.74%
/6)^12-1 =9.90%
By dividing by 6, the interest is expressed in monthly terms
By raising to the power of 12 , it is expressed in yearly terms
