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Readme [11.4K]
3 years ago
11

Using both the supply and demand for bonds and liquidity preference framework, show how interest rate are affected when the risk

iness of bonds rises. Are the results the same in the two frame works
Business
1 answer:
nignag [31]3 years ago
4 0

Answer:

Yes, the results are the same in both frameworks. Please see below for explanation.

Explanation:

With regards to the bond supply and demand framework, people will look to buy more bonds since they are more wealthy now. Hence, the supply of bonds will increase. The supply curve and the demand curve will both move to the right, with the former shifting more than the latter. The equilibrium interest rate will increase.

With regards to the liquidity preference framework, once the economy experiences a positive shift, there will also be an increase in the demand for money. People will make an increased number of transactions as well and hence, the demand curve will move towards the right. The equilibrium interest rate will rise too.

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Hurry!!!! (economics) This graph shows changes in GDP and the unemployment rate in the United States in recent years.
yaroslaw [1]

Answer:

A. When GDP falls, unemployment rises.

Explanation:

7 0
2 years ago
"Vaughn Corporation is considering the issue of commercial paper and would like to know the yield it should offer on its commerc
Naddik [55]

Answer:

7.6 percent

Explanation:

Vaughn should offer 7.6 percent on its commercial paper.

This is calculated by adding the 0.2 credit risk premium to 0.1 percent liquidity premium + 0.3 percent tax adjustment + 7 percent annualized t bills rate.

= 0.1 + 0.2 + 0.3 + 7

= 7.6

Based on this Vaughn would offer 7.6 percent on its commercial paper.

6 0
3 years ago
An investor has opened a jewellery store and a bakery shop in your village which is near the sea side. Do you consider the locat
almond37 [142]

Answer:

The bakery business is a good business for this location but the jewellery is not.

Explanation:

The bakery business is a good business for this location but the jewellery is not. This is because the vast majority of individuals in the area are most likely going to be people spending the day travelling and going to the beach or taking a walk on the boardwalk. Therefore, pasteries in the morning on a nice day or in the afternoon would be in demand in that area. However, jewellery probably will not be in high demand. The best place for a jewellery store is in the middle of the city where people go to shop, ideally a high income location.

7 0
3 years ago
1
NISA [10]

Answer:

Point C

<em>Diagram is available online but cannot be imported due to its format</em>

Explanation:

A reduction in the cost of inputs means that suppliers will avail more fish in the market. An increase in supply caused by other factors other than price shifts the supply to the right. A shift of the supply curve outwards or the right makes the equilibrium point to move to capture an increase in supply.

In the diagram, the new equilibrium point will be at point C. The supply will increase due to a reduction in input costs.

8 0
3 years ago
Project management boils down to asking which questions?
insens350 [35]

Answer: d. all of the answers

Explanation: Project management typically involves the planning, build-up, implementation, and closeout of projects and is defined as the organization and management of resources such as people, materials, etc. in such a way that a given project is completed within defined scope, quality, time and constraints of costs. In this, it asks questions bordering on planning,  (what problem needs solving, people involved, and what will be done?), implementation and close-out (when would the project end, how would you know you have arrived at its completion, how do you go about it?) etc.

4 0
3 years ago
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