Suppose that Karen deposits $500 into her checking account at the bank. The reserve requirement for Karen'sbank is 12%. Assume the bank does not want to hold any excess reserves of new deposits.a. Use this information to complete the table below to show how the bank's assets and liabilities change whenKaren deposits the $500.AssetsLiabilitiesChange in Reserves: $Change in Deposits: $Change in Loans: $b. Why are deposits considered liabilities for a bank?Deposits can be loaned out by the bank.Deposits can be withdrawn at any time.Deposits pay interest to the owner.Deposits must be kept as reserves at the Federal Reserve.14.value:10.00 pointsAssume the economy is currently in equilibrium at its full-employment level of output, the money market is inequilibrium, and the MPC = 0.75.a. Suppose there is a decrease in consumer confidence that causes aggregate demand to decrease by $32billion. Show the decrease in aggregate demand on the graph.Instructions:Use the tool provided 'Aggregate Demand' to plot the new aggregate demand curve. Use the toolprovided 'New GDP
A firm's total revenue can be determined by price and quantity. Hence, Option 5 is correct.
<h3>
What is the total revenue?</h3>
A profit or an income that is generated by a company after selling products or services is known as total revenue. It is also known as gross revenue. Let's understand total revenue with the help of an example:
No. of products sold = 25
The price of each item is $20.
Total revenue = price × quantity
= 20 × 25
= $500
The total revenue of the firm is $500.
Thus, Total revenue can be determined with option 5: price× quantity.
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GDP stands for gross domestic product.
MPC stands for marginal propensity to consume (the ratio of the ratio of change in consumption to change in income)
From MPC you obtain the GDP Multiplier, which gives the relationship between a change in a particular expenditure and the GDP.
This is: Change in GDP = Mutliplier * Change in expenditure
The multiplier is equal to 1 / [ 1 - MPC].
Now use that information to calculations.
<span>Change in GDP with MPC of 0.9
multiplier = 1 / [1 - 0.9 ] = 1 / 0.1 = 10
Change in GDP = 8 billions*10 = 80 billions.
Change in GDP with MPC of 0.8 </span>
multiplier = 1 / [1 - 0.8] = 1 /0.2 = 5
Change in GDP = 8 billions*5 = 40 billions
Answer:
The holding period return of the stock is - 6 % or - 6.0%
Explanation:
Solution
Given that:
You are thinking of purchasing a stock that currently sells for= $50
The expected price of the stock =$45
Dividend expected to be paid =$2
Risk free rate = 5%
Market return = 10%
Stock (beta) = 0.85
We will now find the holding period return of the stock which is given below:
The formula for calculating the holding period return of a stock is given as,
= The Expected price in a year + Dividend earned during the year – Purchase Price / Purchase Price
We recall that:
The Purchase Price = $ 50
Expected price in a year = $ 45
Dividend earned during the year = $ 2
Now,
By Applying the above values in the formula we have the holding period return of the stock as
:
= [45 + 2 – 50] / 50
= - 3 / 50
= - 0.0600 = - 6.00 %
= - 6.0 % ( when rounded off to one decimal place )
Therefore, the Holding period return of the stock is - 6 % or - 6.0%
Answer:
$28.57
Explanation:
The holders of ZZZ corporation bonds with a face value of $1000
It can be exchanged for 35 share of the stock
The stock is being sold for $25.00
Therefore, the conversion price can be calculated as follows
= $1000/35
= $28.57
Hence the conversion price is $28.57
