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Under what circumstances might they change their portfolios, moving their funds out of bonds into bank accounts? In general, people place their funds in those investments which provide them the highest returns.
Answer:
The correct answer is option b.
Explanation:
Shen is working in a country where the inflation rate is high.
He gets a salary every two weeks.
After receiving his salary he immediately goes out and buys all the goods he is going to need over the next two weeks.
He converts the remaining salary in a more stable currency.
He does this in order to prevent his salary from losing purchasing power.
This effort that he is making to prevent his real income from losing value is called the shoe-leather cost of inflation.
The shoe-leather cost can be defined as the cost of time and effort made to prevent the cash holdings from losing their value.
Answer:
are $270 billion
Explanation:
Change in business inventories in 2012 = -$70 billion
GDP of 2012 = $200 billion
Final sales in 2012 = GDP - Change in inventory
Final sales in 2012 = $200 billion - (- 70 billion )
Final sales in 2012 = $200 Billion + 70 billion
Final sales in 2012 = $270 billion
Hence proved that the correct answer is $270 billion
