Answer:
The Central Bank is trying to increase money supply.
Explanation:
When the Central Bank makes moves to increase reserves, it means that it is simply trying to mop up excess cash from the economy to fight inflation. Spiking inflation means that the power of a currency is gradually being eroded. The Central Bank cannot allow this to happen so it hits the "Reduce Money In Circulation" button. It does this by reviewing upwards, the money reserves which commercial banks must hold with the Central Bank.
It can also increase the rate at which it lends to the Commercial Banks and Investment houses. Commercial Banks, in turn, transfer the additional cost of borrowing to businesses who will seek loans. This slows down the rate at which money is pumped into the economy.
In the question, however, we notice that the Central Bank has enervated its reserves. This means that it is pumping more money into the economy. This economic move may have been executed to prevent the economy from slipping into a recession or simply to stimulate the economy.
In the short run, increased money supply means, businesses have more access to funds from commercial banks. More funds mean, more investment. Increased investment spending means the businesses will need to expand operations, hire more staff, and the multiplier effect goes on and on.
Cheers!
Answer:
A
Explanation:
if its wrong than forsure d
Answer:
- <u><em>4,099 units or more</em></u>
Explanation:
The cumulative distribution of a random variable X that follows a normal distribution is given by the area undear the "bell curve" and the values are given by the corresponding table for the standard normal distribution.
The standardized value of the variable X is called Z and is calculated with the formula:
Where:
You read the Z-value for which the probability is greater than or equal to 5% in the table for the values of the area to the right of Z. Using probability = area under the curve ≥ 5%, the Z-value is 1.645 (interpolating between p = 0.0495, Z = 1.64 and p = 0.0505, Z = 1.65).
Substituting in the formula for Z:
- X= 60 × 1.645 + 4,000 = 4,098.7 ≈ 4,099
Hence, the bonus will be paid on 4,099 units or more.
Answer:
3.10; 1.53
Explanation:
Total Current Assets:
= Cash + Receivables + Inventory + Other Current Assets
= $99 + $91 + $179 + $15
= $384 million
Total Current Liabilities:
= Accounts Payable + current portion of long-term debt
= $92 + $32
= $124 million
Current Ratio:
= Total Current Assets ÷ Total Current Liabilities
= $ 384 ÷ $ 124
= 3.10
Acid Test Ratio:
= (Cash + Accounts Receivables ) ÷ Current Liabilities
= $(99 + 91) ÷ $124
= 1.53
Answer:
8.23%
Explanation:
Since this bond pays semi-annual coupons, it means that the payments occur every 6 months; making it 2 periods per year. Using a Financial calculator; enter the following inputs. If using TI BA II plus, key in the number first, then the function.
Total duration; N = 9*2 = 18
Face Value ; FV = 1,000 (use 1,000 if the value is not given)
Present value or price ; PV = -754.08
Semiannual Coupon Payment; PMT = Semiannual coupon rate *Face value
Semiannual Coupon Payment; PMT = (7.25%/2) *1000 = 36.25
The Yield to maturity;YTM is the <em>annual</em> pretax I/Y which is the Pretax cost of debt in this case
therefore, CPT I/Y = 5.875% (note: semi-annual rate)
Next, convert the semiannual rate to annual rate i.e the YTM;
= 5.875%*2
Pretax cost of debt (YTM) = 11.75%
Aftertax cost of debt = Pretax cost of debt (1-tax)
= 0.1175% (1-0.30)
= 0.08225 or 8.23%
