Money supply is the total amount of money in circulation which includes coins, cash and balance in savings account in a country at a period of time.
- Given a fixed supply of money and a downward sloping aggregate demand curve, an increase in money demand will <u>not change</u> the price paid for its use, otherwise known as the <u>discount rate.</u>
- A change the money supply in a country causes a change in aggregate demand.
- An increase in the money supply causes increase in aggregate demand and a decrease in the money supply causes decrease in aggregate demand.
Therefore, an increase in money demand will not change the price paid for its use, otherwise known as the discount rate.
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No, its okay not to use all that extra stuff, so F
Answer:
0.147 or 14.7%
Explanation:
Equity (E) =$7
Debt (D) = $1
Cost of equity capital (Ce) = 0.16
Pretax cost of debt (Cd) = 0.08
Tax rate (r) = 0.3
The weighted average cost of capital of the firm is given by the following relationship:
The weighted average cost of capital of the firm is 0.147 or 14.7%.
Answer:
increase
increase
Explanation:
Discretionary fiscal policies are deliberate steps taken by the government to stimulate the economy in order to cause the economy to move to full employment and price stability more quickly than it might otherwise.
Discretionary fiscal policies can either be expansionary or contractionary
Expansionary fiscal policy is when the government increases the money supply in the economy either by increasing spending or cutting taxes.
Expansionary fiscal policies increases money supply which increases aggregate demand, as a result output or real GDP increases
Contractionary fiscal policies is when the government reduces the money supply in the economy either by reducing spending or increasing taxes
Answer:
d. decrease, and U.S. net capital outflow increases.
Explanation:
Yuan is the currency of the country China and the currency of United States of America is dollar. Every country in the world does imports of some goods to meet the demands of the country and exports some items to the other countries that is produced in abundance in the parent country. In this way, countries earn huge capital by doing importing and exporting.
In the context, China will buy scrap metal from United States, thus China is importing a good from U.S. So China will have more of import. Hence China net export will decrease. While U.S. is selling goods to China in exchange of dollar and earning capital. So, net capital outflow of the United States will increase.
