Answer:
The correct answer is lower.
Explanation:
The theory of rational expectations is a hypothesis of economic science that states that predictions about the future value of economically relevant variables made by agents are not systematically wrong and that errors are random (white noise). An alternative formulation is that rational expectations are "consistent expectations around a model," that is, in a model, agents assume that the predictions of the model are valid. The rational expectations hypothesis is used in many contemporary macroeconomic models, in game theory and in applications of rational choice theory.
Since most current macroeconomic models study decisions over several periods, the expectations of workers, consumers and companies about future economic conditions are an essential part of the model. There has been much discussion about how to model these expectations and the macroeconomic predictions of a model may differ depending on the assumptions about the expectations (see the web's theorem). To assume rational expectations is to assume that the expectations of economic agents can be individually wrong, but correct on average. In other words, although the future is not totally predictable, it is assumed that the agents' expectations are not systematically biased and that they use all the relevant information to form their expectations on economic variables.
If the Fed buys U.S. government securities from banks, the federal funds rate falls and banks' reserves increase.
<h3>Fed's Monetary Policy</h3>
- Price stability and full employment, the Federal Reserve's two legally mandated goals, are necessary to ensure a healthy and expanding economy in the United States.
- In the past, the Fed has achieved this via modifying reserve requirements, conducting open market operations (OMO), and influencing short-term interest rates.
- By acquiring government assets, the Fed helps to boost bank reserves and bring down the federal funds rate. Government securities will be sold by the Fed on the open market.
- The Fed reduces the amount of money in circulation by selling government assets, which raises the federal funds rate.
- OMO has an impact on interest rates as well because when the Fed purchases bonds, prices are pushed up and rates are lowered; conversely, when the Fed sells bonds, prices are pushed down and rates are raised.
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Answer:
Answer is Nap.
Explanation:
The surface of the fabric that is used to pluck yarn from fabric is called nap. The process is called napping, in which the fibres are teased and then the soft fur-like surface is created. This process is mostly used yarning of blankets and woollen fabrics.
Answer:
Rate of return=0.222=22.2%
Explanation:
Price at which shares are sold=$45 per share
Number of shares=100 shares
Initial margin=50%=0.5
Price of share on repurchase=$40 per share
Required:
Rate of return if shares are repurchased=?
Solution:
Rate of return=
Profit earned=($45-$40)*100
Profit earned=$500
Initial Investment=(100*45)0.5
Initial Investment=$2,250
Rate of return=
Rate of return=0.222=22.2%
