Answer:
the money supply in Macroland will increase from <u>5,000</u> econs to <u>7,000</u> econs
Explanation:
Currently, Macroland's money supply = 2,000 econs held by the public and 3,000 econs held by the banks (= 300 econs x 1/0.1).
In order to determine the increase in the money supply we must multiply the inflow of econs by the money multiplier. The money multiplier = 1 / reserve ratio = 1/0.1 = 10.
Since the government is injecting 200 econs to the economy, the increase in the money supply = 200 econs x 10 = 2,000 econs.
So now, Macroland's money supply will increase from 5,000 to 7,000 econs.
The money multiplier measures the banking system's ability to "create" money. The banking system creates money by first receiving deposits, e.g. you deposit 10 econs in your savings account, and then lending money to another client. The bank will lend 9 econs (-10% required reserve) to John that will purchase a bike. The seller of the bike receives the money form John and deposits the 9 econs in his own bank. Then this second bank will lend 8.10 econs to Sarah. Sarah will use the money to purchase a new computer and a printer from Tom. Tom then deposits the money in his bank, and then his bank lends 7.29 econs to Sally, and the wheel goes on and on.
This money creating process is possible because Macroland uses a fractional banking system, which means that the banks are only required to keep a fraction of total deposits as reserves.
Answer:
maximize profits.
Explanation:
Th economist assume that the goal of objective of the business is to maximize the profit and add value to their business and shareholders as well. The businesses use marginal benefit and marginal cost to measure the value of benefit. Business also has other objectives which support the profit maximization like cost minimization, customer satisfaction etc
Lori will make $27.00 more.
Step-by-step explanation:
The formula to calculate simple interest is
A = P(1+rt)
P = Principal amount
r = rate of interest ( in decimal )
t = time
First we calculate Darryl's deposit, so put the values in the formula
A = 1,500(1 + 0.027×10)
A = 1,500 ( 1+0.27 )
A = 1,500 × 1.27
A = $1905
Now we will calculate Lori's deposit
A = 1,400 ( 1 + 0.038 × 10 )
A = 1,400 ( 1 + 0.38 )
A = 1,400 × 1.38
A = $1,932
Lori will make money after 10 years = $1,932
Darryl will make money after 10 years = $1905
so Lori will make more than Darryl, the difference will be = 1,932 - 1,905 = $27
After 10 years Lori will have make $27.00 more in their account.
Answer:
a. Marketing intermediaries
Explanation:
Marketing intermediaries are independent firms that assist in the flow of goods and services from producers to end-users; they include agents, wholesalers and retailers; marketing services agencies; physical distribution companies; and financial institutions. Also referred to as Middlemen
Answer:
The perpetuity pays $2,040 every year.
Explanation:
The formula to find the present value of a perpetuity is
present value = cash flow/interest rate
In this question we are given the interest rate and present value and we need to find the cash flow, so we will just input these values in the formula.
Present value = 34,000
Interest rate =6%
34,000=Cash flow/0.06
34,000*0.06= cash flow
Cash flow =2,040
