If the interest rate increases, then both the quantity saved and the quantity supplied of loanable funds will increase.
Explanation:
Profit is the amount of money that borrowers receive if the creditor accepts a loan and the rate of interest is the percentage of the debt the lender pays to lease property.
As interest rates increase, both businesses and customers rising spending. That would reduce sales and reduce product costs.
At the other hand, with large interest rates declining, buyers and firms increase their spending, thus rising asset values.
Answer:
Fixed costs= $200
Explanation:
Giving the following information:
Output for a simple production process is given by Q = 2KL, where K denotes capital, and L denotes labor. The price of capital is $25 per unit and capital is fixed at 8 units in the short run. The price of labor is $5 per unit.
In this case, labor is a variable cost, the more you produce, the bigger it gets (total variable costs, unitary remains the same).
So, our only fixed cost is capital. We know that in a short run capital equals 8 units
Fixed costs= $25*8= 200
Answer:
a scale of preference has to be drawn.
Explanation:
This is an economic concept where a choice is made between two or more items based on the order of importance.
Answer:
d. sells Treasury bonds. The larger the reserve requirement, the larger the decrease will be.
Explanation:
If the Fed targets to decrease the money supply, it uses contractionary policies. These are policies that make it hard for banks to loan out money to firms and households. By selling treasury bonds to banks, the Fed reduces the money available to the banks to loan out. Banks pay for the treasury bonds using customer deposits, thereby draining the money available to be issued out as loans.
Increasing the size of the reserve requirement reduces the percentage of deposits available to be loaned out. Reserves are a percentage of customers deposits that the Fed requires banks to maintain in their custody at all times. Reserves cannot be issued out as loans. The larger the reserve requirements, the lesser the proportion of funds are available for credit purposes.