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ziro4ka [17]
3 years ago
8

What does monatary policy do

Business
2 answers:
mezya [45]3 years ago
6 0

Answer:

<em>Monetary policy</em> consists of management of money supply and interest rates, aimed at achieving macroeconomic objectives such as controlling inflation, consumption, growth, and liquidity.

Elena-2011 [213]3 years ago
3 0

The monetary policy regulates cash supply, controls inflation, adjusts interest rates to regulate the market, and money costs  

<u>Explanation: </u>

Monetary policies raise flexibility in order to produce economic development. This reduces money to prevent inflation.

Three objectives of monetary policy:

  • Inflation is the most important thing.  
  • The second aim is to reduce unemployment, but only after inflation has been controlled.  
  • Thirdly, low long-term interests rates should be encouraged.

The four tools to fulfil monetary policy goals:  

Risk-Free rate: Federal Reserve discount funding complements monetary policy to the federal fund's goal, which provides commercial banks with backup liquidity.

Capital requirements: The amounts of funds that lenders have to hold in cash or on loan in their containers at reserve banks.

Market Activities: U.S. government bond purchase and selling has been a trustworthy device.

Reserve interest: Excess funds kept at Reserve Banks were charged for interest on deposits.

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According to U.S. GAAP, asset retirement obligations are ________.
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$6,100

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Although there are some clear disadvantages associated with extending credit to customers, such as bad debt costs, most managers
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Antonio has $11.00 to spend on a lunch consisting of hamburgers ($1.50 each) and French fries ($1.00 per order). Antonio's satis
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Answer: <em>$4. 71 hamburger and $6.29 French fries. </em>

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Total spendable income of Antonio = $11.00  

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Utility maximization function: U(x1, x2) = x1x2 i.e. 1 hamburger and 2 orders of French fries

Using the Utility maximization function: U(x1, x2) = $1.50 + $2.00

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<em>Antonio will maximize his satisfaction by purchasing $4. 71 hamburger and $6.29 French fries. </em>

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