Question
Using the attached hypothetical demand curve, answer the following questions:
- What is the quantity of money demanded when the interest rate is 6%?
- What is the quantity of money demanded when the interest rate is 8%?
- Choose the statement that best explains the relationship between the quantity of money demanded and the interest rate on bonds.
A) If the interest rates increase, the quantity of money demanded decreases.
B) If the interest rates increase, money demand falls.
C) If the interest rates increase, money demand increases.
D) If the interest rates increase, the quantity of money demanded increases.
Answer 1) & 2)
When the interest rate is 6%, the demand for money is $40 billion, and when the interest rate climbs to 8%, the money nosedives to $20 billion.
Answer 3):
The correct choice is B)
Explanation:
The relationship between interest rate and money demand is very simple. The higher the rate, the higher the cost of capital. The higher the cost of capital, the lower the Return On Investment. Because businesses are structured to thrive on more profit or returns, business owners, generally will gun for more money when there is a lower interest rate thus creating a surge in demand.
Kindly note that the analysis is based the assumption that all other factors remain constant.
Cheers!
Answer:
Situation analysis
Explanation:
The situational analysis helps in collecting information about an incident or trend in the environment and changes in external and internal environment that constitutes to this change. This report is based on the situational analysis and the opinion is formed by considering the new market entrants, trade agreements, exports, technological implications, fewer taxes imposed on the imports, etc. These all factors present in the market are considered and industry specific data is interpreted using this information. This statement reflects the situational analysis of the industry.
Answer:
Martin works as a pizza delivery person. He parks his bike outside Regalia Inc. To deliver an order. Meanwhile, a damaged book rack in Regalia, which is situated on the first floor of the building, falls down through an open window and crashes on his bike. However, no one admits to having seen the rack fall. Can Martin recover against Regalia for negligence?
It is a dicey situation, if Regalia Inc has a parking lots and Martin did not use it rather he just parked at his convenience, then no one will be responsible for such but if he parked at allotted space for bikes and such occurrence happened then Regalia inc will bear the cost and pay for damages.
Explanation: