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Grace [21]
3 years ago
15

Felix receives a portion of his income from his holdings of interest-bearing U.S. government bonds. The bonds offer a real inter

est rate of 4.5% per year. The nominal interest rate on the bonds adjusts automatically to account for the inflation rate.
The government taxes nominal interest income at a rate of 10%. The following table shows two scenarios: a low-inflation scenario and a high-inflation scenario.
Inflation Rate Real Interest Rate Nominal Interest Rate After-Tax Nominal Interest Rate After-Tax Real Interest Rate
(Percent) (Percent) (Percent) (Percent) (Percent)
2.0 2.5
7.5 2.5
Compared with higher inflation rates a lower inflation will (increase/decrease) the after-tax real interest rate when the government taxes nominal interest income. This tends to (encourage/discourage) saving, thereby (increasing/decreasing) the quantity of investment in the economy and (increasing/decreasing) the economy's long-run growth rate.
Business
1 answer:
Black_prince [1.1K]3 years ago
5 0

Answer:

4.5% 4.05%  2.25%

10% 9% 2.25

increase

encourage

increasing

increasing

Explanation:

Nominal interest rate = real interest rate + inflation rate

2.0 + 2.5 = 4.5%

7.5 + 2.5 = 10%

Nominal after tax interest rate = nominal interest rate x (1 - tax rate)

4.5% x (1 - 0.1) = 4.05

10 x (1 - 0.1) = 9  

Real after tax interest rate = real interest rate x  (1 - tax rate)

2.5 x  (1 - 0.1) = 2.25

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Regional trade agreements In the following table, indicate whether each statement about regional trade agreements is true or fal
trasher [3.6K]

Answer:

A. True

B. True

C. True

D. True

E. False

F. True

Explanation:

It is true that under regional trade agreements, several countries eliminate tariffs among themselves and lower tariffs against all other countries.

It is true that regional trade agreements are consistent with GATT's most favored nation principle. GATT is an acronym for General agreement on tarrifs and trade and most favoured nation (MFN) is a status or level of treatment accorded by one state to another in international trade. The term means the country which is the recipient of this treatment must nominally receive equal trade advantages as the "most favoured nation" by the country granting such treatment (trade advantages include low tariffs or high import quotas).

It is true that the countries in the European Union (EU) keep their own tariffs with the countries outside the EU. The EU trade agreement is basically to promote trade among EU countries, not necessarily to lower tariffs for non members.

US and China have a trade agreement which lowers tarrifs and US and Canada operate a Free Trade agreement (FTA) which seeks to eliminate all tarrifs on trade between the two countries. Therefore If China wants to sell a good to Canada, it can first export it to the United States, where the tariff is lower, and then ship it duty- free to Canada.

It is false that countries who enter into a free trade area agreement maintain a common schedule of tariffs with countries outside the agreement. The agreement does not cover trade among non members.

In customs union, rules of origin are not needed. Custom unions only considers where the good is shipped from and not the originating nation.

8 0
3 years ago
Each unit of a product requires 5 components. The average number of components is 5.50 due to component failure. Purchasing high
Evgesh-ka [11]

Answer:

correct option is d. $225

Explanation:

given data

product requires  = 5 component

average number of components = 5.50

reduce average number of components = 5 per unit

cost per component = $450

solution

we get here reduction in failure costs per unit due to purchasing that is express as

reduction in failure costs per unit due to purchasing = ( average number of components - product requires ) ×  cost per component   .......................1

put here value and we get

reduction in failure costs per unit due to purchasing = ( 5.50 - 5 ) × $450

reduction in failure costs per unit due to purchasing = $225

so correct option is d. $225

4 0
3 years ago
I feel nice so just tell me your fave game
luda_lava [24]

Answer: The sims

Explanation: Because its the best

5 0
3 years ago
Read 2 more answers
Consumer products are a. products used in the production of other items. b. products an industrial buyer will make an effort to
Olegator [25]

Answer:

the correct answer is c. products purchased by the ultimate consumer.

Explanation:

there are two types of goods, they are, consumer goods and industrial goods.

Consumer goods are the once that are purchased by the consumers for the purpose of consumption and not to produce anything from them.

While industrial goods are mainly bought by companies and producers to produce more goods.

4 0
4 years ago
What are examples of Government and Public Administration careers? Select three options. Lawyer Security Guard Farmworker Postal
Vilka [71]

The Postal Service Mail Carrier, Foreign Service Specialist, US Army Member​ are the examples of Government and Public Administration careers.

<h3 /><h3>What are government and public administration careers?</h3>

  • The Government and Public Administration bunch consists of occupations in law enforcement and security offices.

  • The military falls under this cluster. Some public service offices, especially in the administration, separated in this cluster.

  • They include municipal clerks, postal service clerks, tax assessors, mail carriers, and air crew members.

  • Jobs in the government and public administration career bunch come to planning, managing, and providing government assembly and administrative and regulatory services.

Therefore, Postal Service Mail Carrier, Foreign Service Specialist, US Army Member​ are the best examples of  Government and Public Administration careers as it requires government control.

Learn more about Government and Public Administration careers, refer:

brainly.com/question/646839

5 0
2 years ago
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