Answer:
Suppose the nominal interest rate on car loans is 11% per year. If borrowers and lenders expect an inflation rate of 2% per year, the expected real interest rate is <u>9%</u> per year. REAL INTEREST RATE = NOMINAL INTEREST RATE - INFLATION RATE
Suppose the Fed unexpectedly increases the growth rate of the money supply, causing the inflation rate to rise unexpectedly from 2% to 6% per year. In the short run, the real interest rate on car loans will <u>DECREASE</u> to 5% per year.
The unanticipated change in inflation arbitrarily benefits <u>BORROWERS (AND HURT LENDERS)</u>.
Now consider the long-run impact of the change in money growth and inflation. According to the Fisher effect, as expectations adjust to the new, higher inflation rate, the nominal interest rate will <u>INCREASE TO 15% SO THE REAL INTEREST RATE IS EQUAL</u> to 9% per year.
Explanation:
Answer:
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Explanation:
Answer:
The adjustment should be recorded in the general ledger as : 1. Debit Bank fee expense$45 and Credit bank account $45
Explanation:
The Cash Book Bank Balance and Balance on the Bank Statement sometimes do not balance because of Unrecorded Items
The bank charges and fees of $45 represent an item recorded in by the Bank in the Bank Statement but not recorded in the Cash Book.
Thus the adjustment for this is to <em>decrease</em> the Cash Book - Bank Balance and <em>recognise </em>an expense in the Income statement related to these Bank Charges.
Its important to conduct market research on your target audience before building your marketing plan because you need to consider who your potential customers are before deciding on marketing strategies. Customers enjoy sharing their opinions, so market research will make your product sell more.
Answer:
Pull Strategy
Explanation:
The Pull Strategy is a marketing strategy which consists in having the customer seek the product by himself or herself.
The goal is to create consumer demand before kickstarting production.
In this case, we have a perfect example of a pull strategy, because Hyun will not start production unless it has proof of demand from a customer, the proof being a order.