When borrowing money becomes easier, consumption and lending (and borrowing) rates tend to rise.
Higher rates of consumption, lending, and borrowing can be linked to a rise in an economy's overall output, expenditure, and, presumably, GDP in the near run.
For a given price level and output, an increase in the money supply lowers the interest rate.
<h3>What Factors Influence Money Supply?</h3>
The most important determinant of the money supply is the Federal Reserve policy.
The Federal Reserve influences the money supply via changing bank deposits, which are its most essential component. This is how it goes.
Depository institutions (commercial banks and other financial institutions) are required by the Federal Reserve to retain a portion of their deposit liabilities as reserves.
These reserves are held by depository institutions as cash in vaults or ATMs, as well as deposits at Federal Reserve banks.
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Answer:
b) net income less preferred dividends by average common stockholders’ equity
Explanation:
Common stock dividends in a company is paid to stockholders after preferred dividends have been removed.
Preference shares are issued to investors with an agreement that they will recieve dividends before other shareholders.
So when calculating return on common stockholder's equity we will first deduct dividend paid to preference share holders.
The income coming to common share holders is now divided by average common stockholders equity to get the return on common stock equity.
Return on equity is usually used as a measure of how efficiently management uses company's assets to generate profits.
Answer:
increase the quality of team problem solving
Explanation:
In simple words, the ERG idea to develop a new dimension for more efficiency in the company is a clear evidence that the company and the team can now solve their problems more effectively.
The given case relates to the benefits of having diversity in the organisation with respect to culture, gender and age etc. It makes a more comfortable safe zone within where new ideas come everyday.
Answer:
The correct answer is: A
Explanation:
The velocity of money is a measurement of the rate at which money is exchanged in an economy. It is the number of times that money moves from one entity to another. The velocity of money is important for measuring the rate at which money in circulation is being used for purchasing goods and services.
Economies that exhibit a higher velocity of money relative to others tend to be more developed. The velocity of money is also known to fluctuate with business cycles.
Velocity of money formula:
Velocity of Money = GDP / Money Supply
According to the<em> </em><em>quantity theory of mone</em><em>y</em>, inflation occurs because there is too much money available to buy the same amount of goods and services produced in the economy. It relates the general price level, the total goods and services produced in a given period, the total money supply and the speed (velocity) at which money circulates in the economy in the following equation:
MV = PQ
M stands for money.
V stands for the velocity of money (or the rate at which people spend money).
P stands for the general price level.
Q stands for the quantity of goods and services produced.
If for some reason the money velocity declines rapidly, it can offset the increase in money supply and even lead to deflation instead of inflation.
When more transactions are being made throughout the economy, velocity increases and the economy is likely to expand. <u>The opposite is also true: Money velocity decreases when fewer transactions are being made; therefore the economy is likely to shrink.</u>
Answer:
Silent partner, secret partner
Explanation:
Partnership is an arrangement between two or more individuals to come together to form a business.
Silent partners are also known as investors. They are individuals who invest money into the business. Silent partners do no participate in the daily running of activities in the organization. The only means of contribution of the silent partner to the business is the provision of capital.
Secret partners are partners whose membership is not disclosed to the public, they take part in decision making processes in the organization.
