All categories

3 years ago

If we look at the equation for money demand from Irving Fisher, which of the following statements is true?

Business

1 answer:

Juliette [100K]3 years ago

6 0

Answer:

The correct answer is option D.

Explanation:

The money equation given by Irving fisher is popularly known as fisher's equation.

The equation is given as MV=PT

Here, M represents money supply, V is the velocity of money, P is the price level and T refers to the volume of transactions or output level.

The supply of money refers to the quantity of money in existence while the velocity of transactions shows the number of times, money changes hands. Together they show the volume of money in circulation.

P is the average price level and T represents the expenditures on all transactions or, in other words, output level.

Here, V and T are assumed to be constant. This means that the money supply directly affects the price level.

There is no explicit mention of the interest rate in this equation.

So, option D is the correct answer.

You might be interested in

What would economic conditions potentially be like in the u.s if the federal reserve did not regulate monetary policy, monitor b

kenny6666 [7]

If the Federal Reserve did not regulate monetary policy, monitor banks, and provide services for banks, then the transactions would be more costly and interest rates will be more.

The Federal Reserve (Fed) in the US manages the economic and financial system in US. It regulate the monetary policy, monitor banks and provide services for banks. They monitor banks so that there will be no more increases in the costs of transactions than the cost agreed by the Fed. Also it will also reduce the possibility of increase in interest rates as the monetary policy is also implemented by the Fed. As a head of the banks, the Federal Reserve also provide services to other banks. In short, the Fed keeps the US economy stable. If they did not regulate monetary policy, monitor banks, and provide services for banks, then it would have been hard to keep this economic stability in US.

Learn more about Federal Reserve at brainly.com/question/382312

#SPJ4

4 0

2 years ago

If Division Inc. expects to sell 200,000 units in the current year, desires ending inventory of 24,000 units, and has 22,000 uni

Lyrx [107]

Answer:

a) True

Explanation:

Sales = Opening + Production - Closing

$200,000 = $22,000 + Production - $24,000

Production = 202,000 Units

Hence, the answer is a. True

4 0

3 years ago

"New York City is issuing $500,000,000 of general obligation bonds paying interest on January 1st and July 1st of each year unti

poizon [28]

Answer:

8 months for the first interest
6 months for the second

Explanation:

The interest is to be paid semi-annually which means that it accrues for 6 months. However, the bond was issued on May 1, 2020 which is 8 months before the first interest payment on January 1, 2021 so the January payment will have to cover for those months as interest starts to build immediately the bond is purchased.

The second payment on July 1, 2021 will cover the period of 6 months between January 1 and July 1, 2021.

8 0

3 years ago

"Alyeska Services Company, a division of a major oil company, provides various services to the operators of the North Slope oil

Alekssandra [29.7K]

Answer:

The margin for Alyeska Services Company: 29.48

The turnover for Alyeska Services Company: 49.01

The return on investment for Alyeska Services Company: 14.45

Explanation:

Please find the below for detailed explanation and calculations:

We have the formula for calculating the ratios as require in the question: Margin = Net operating income/ Sales ; Turnover = Sales/Average operating assets; Return on investment = Net operating income/ Average operating assets.

Thus, we have:

The margin for Alyeska Services Company is calculated as Net operating income/ Sales or 5,100,000/17,300,000 = 29.48%;

The turnover for Alyeska Services Company is calculated as Sales/Average operating assets or 17,300,000/35,300,000 = 49.01%;

The return on investment for Alyeska Services Company is calculated as Net operating income/ Average operating assets: 5,100,000/35,300,000 = 14.45%.

Hope this is helpful to you.

6 0

3 years ago

The Muffin House produces and sells a variety of muffins. The selling price per dozen is $ 18, variable costs are $ 5 per doze

Vlad1618 [11]

Answer:

$7,222

Explanation:

Given that,

Selling price per dozen = $18

Variable costs = $5 per dozen

Total fixed costs = $ 5,200

Contribution margin per dozen:

= Selling price per dozen - Variable costs per dozen

= $18 - $5

= $13

Contribution margin ratio:

= (Contribution margin ÷ Selling price per dozen) × 100

= ($13 ÷ $18) × 100

= 0.72 × 100

= 72%

Break-even sales in dollars:

= Total fixed costs ÷ Contribution margin ratio

= $5,200 ÷ 0.72

= $7,222

6 0

3 years ago