If firms in the economy find that there are less profitable business opportunities, then in the...
If firms in the economy find that there are less profitable business opportunities, then in the bond market, the equilibrium interest rate will ____ and the equilibrium price will ____ . rise; fall rise; rise fall; rise fall; fall
Homework Answers
If the firms in the economy realize that there are less profitability in the business opportunities means less risk is involved that means a rate of interest will fall and the bond price is inversely related to interest rate would rise.
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If firms in the economy find that there are less profitable
business opportunities, then in the...
Suppose that wealth levels decrease and firms' profitable business opportunities increase in the economy. Then in...
Suppose that wealth levels decrease and firms' profitable business opportunities increase in the economy. Then in this market, the equilibrium price for bonds will fall will rise could go up or down, it's impossible to tell none of the above
The liquidity levels of bonds decreases and the profitable business opportunities in the economy decrease. In...
The liquidity levels of bonds decreases and the profitable business opportunities in the economy decrease. In the market for bonds, we expect that the demand curve should shift and the supply curve should shift left:left left:right right:left right:right
If there is an increase in taxes on business firms in a small open economy, it...
If there is an increase in taxes on business firms in a small open economy, it causes the current account to and saving fall; fall rise; remain unchanged fall; remain unchanged rise; fall
Consider an economy at full employment. If consumers and firms become less optimistic about the future...
Consider an economy at full employment. If consumers and firms become less optimistic about the future economy then O unemployment will rise O price levels will rise. O output will rise. If the economy is in an expansionary period, appropriate policies to pursue may include: O business investment incentives that shift the AD curve to the left. a reduction in government spending that shifts the AD curve to the left. O an income tax cut that shifts the AD curve...
1. Consider an economy at full employment. If consumers and firms become less optimistic about the...
1. Consider an economy at full employment. If consumers and firms become less optimistic about the future economy then a) price levels will rise. b) output will rise. c) unemployment will rise. 2. A ________ in an AD/AS diagram could explain a decrease in cyclical unemployment. a) shift in AS to the left b) shift in AD to the right c) shift in AS to the right 3. An AD/AS model showing equilibrium in the steep section of the aggregate...
The Fed controls interest rates to either tighten or loosen the economy. When the Feds are...
The Fed controls interest rates to either tighten or loosen the economy. When the Feds are needing to tighten the economy, they will raise the interest rates. When interest rates are changed, it sends a ripple effect through the entire financial market. When interest rates rise, cost of capital and borrowing increase. Consumers will borrow and spend less. This will lead to a slower economy and help to hedge inflation. However, the change in interest rates can affect the market...
1. Suppose in an economy there is passed a new regulatory law that reduces the productivity...
1. Suppose in an economy there is passed a new regulatory law that reduces the productivity of newly produced machines. As a result of the change A.there will be an initial shortage of savings and equilibrium investment will fall B.there will be an initial surplus of savings and the equilibrium interest rate will rise C.the equilibrium interest rate will rise because machines are less efficient D.the equilibrium interest rate will fall and equilibrium savings will fall too
T or F Firms tend to be less profitable when there is higher real growth in...
T or F Firms tend to be less profitable when there is higher real growth in the underlying market than when there is lower real growth
Please discuss the impacts of interest rate change on the economy and business firms.
Please discuss the impacts of interest rate change on the economy and business firms.
Consider the aggregate economy represented by the figure below. How would this figure change if income...
Consider the aggregate economy represented by the figure below.
How would this figure change if income taxes were to fall?
Consider the aggregate economy represented by the figure below.
How would this figure change if firms expect future profit to
rise?
Consider the aggregate economy represented by the figure below.
How would this figure change if government spending were to
fall?
Consider the aggregate economy represented by the figure below.
How would this figure be affected if the price of...
The liquidity levels of bonds decreases and the profitable business opportunities in the economy decrease. In the market for bonds, we expect that the demand curve should shift and the supply curve should shift left:left left:right right:left right:right
If there is an increase in taxes on business firms in a small open economy, it causes the current account to and saving fall; fall rise; remain unchanged fall; remain unchanged rise; fall
Consider an economy at full employment. If consumers and firms become less optimistic about the future economy then O unemployment will rise O price levels will rise. O output will rise. If the economy is in an expansionary period, appropriate policies to pursue may include: O business investment incentives that shift the AD curve to the left. a reduction in government spending that shifts the AD curve to the left. O an income tax cut that shifts the AD curve...
Consider the aggregate economy represented by the figure below.
How would this figure change if income taxes were to fall?
Consider the aggregate economy represented by the figure below.
How would this figure change if firms expect future profit to
rise?
Consider the aggregate economy represented by the figure below.
How would this figure change if government spending were to
fall?
Consider the aggregate economy represented by the figure below.
How would this figure be affected if the price of...
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