An increase in interest rates will have this effect on a distributor: a) Higher costs for...
An increase in interest rates will have this effect on a distributor:
a) Higher costs for capital investments
b) Lower cost for capital investments
c) High transportation cost
d) Lower transportation cost
Homework Answers
Since interest rate is the cost of borrowing for investment for machinary and plants. So with the increase in the interest rate cost of borrowing increases, therefore capital investment becomes expensive. Hence investment decreases.
Therefore it can be said that an increase in interest rates will have this effect on a distributorHigher costs for capital investments.
Hence option a is the correct answer.
Add Answer to:
An increase in interest rates will have this effect on a
distributor:
a) Higher costs for...
1. Which of the following properly describes the interest-rate effect? a. A higher price level leads to higher money demand, higher money demand leads to higher interest rates, and a higher interest rate increases the quantity of goods and serv
1. Which of the following properly describes the interest-rate effect? a. A higher price level leads to higher money demand, higher money demand leads to higher interest rates, and a higher interest rate increases the quantity of goods and services demanded.b. A higher price level leads to higher money demand, higher money demand leads to lower interest rates, and a lower interest rate reduces the quantity of goods and services demanded.c. A lower price level leads to lower money demand, lower...
(1) Suppose the risk-free rate goes up to 7%. What effect would higher interest rates have...
(1) Suppose the risk-free rate goes up to 7%. What effect would higher interest rates have on the SML and on the returns required on high-risk and low-risk securities? (2) Suppose instead that investors’ risk aversion increased enough to cause the market risk premium to increase to 8%. (Assume the risk-free rate remains constant.) What effect would this have on the SML and on returns of high-and low-risk securities?
Explain the effect of interest rates on bond pricing and how maturity length and higher and...
Explain the effect of interest rates on bond pricing and how maturity length and higher and lower coupon rates can affect bond prices when interests go up and down in the economy.
At higher interest rates,____ of holding money is high -transaction costs -opportunity costs -benefits
At higher interest rates,____ of holding money is high -transaction costs -opportunity costs -benefits
4. Interest rates and their effect on corporate profits and investment prices Interest rates affect corporate...
4. Interest rates and their effect on corporate profits and investment prices Interest rates affect corporate profits and security prices. Based on your understanding of the relationship between interest rates and corporate profits and security prices, identify which of the following statements is true and which are false. True False Ststements The higher the interest rate on a firm's debt, the lower will be the firm's profits, all other considerations remaining constant. An increase in the interest rate paid by...
A. Interest rates will be unaffected. B. Interest rates will decrease. C Interest rates will increase....
A. Interest rates will be unaffected.
B.
Interest rates will decrease.
C
Interest rates will increase.
D
Interest rates could increase or decrease.
In December 2017, the Trump Administration and the U.S. Congress passed tax reform legislation, the 2017 Tax Cuts and Jobs Act, that cut corporate taxes from 35 percent to 21 percent. Consider the market for money illustrated in the figure below. Assume the market initially (just prior to the legislation) is in equilibrium at point A. What...
Please Help Incorrect Question 43 0/2 pts Because interest rates on government bonds reflect the risk...
Please Help
Incorrect Question 43 0/2 pts Because interest rates on government bonds reflect the risk of default, the historically high bond yields are signaling that government bonds are a risky investment. a country perceived as a higher credit risk can pay lower interest rates when it borrows. bond buyers are willing to accept lower interest payments for bonds perceived as high-risk investments. a country perceived as a higher credit risk must pay higher interest rates when it borrows. Incorrect...
An increase in the wage rate will have a greater effect on average costs a. the...
An increase in the wage rate will have a greater effect on average costs a. the larger the proportion labor costs are of total costs and the easier it is to substitute capital for labor. the larger the proportion labor costs are of total costs and the harder it is to substitute capital for labor. the greater is the diminishing marginal product of labor. c. d. the greater are returns to scale.
33. Using the Keynesian model, the effect of a government-imposed ceiling on interest rates paid on...
33. Using the Keynesian model, the effect of a government-imposed ceiling on interest rates paid on personal checking accounts that is lower than the current market interest rate would be to cause __ in the real interest rate and in output in the short run. (a) a decrease; a decrease (b) a decrease; no change (c) a decrease; an increase (d) an increase; a decrease Answer: C Level of difficulty: 3 Section: 11.3
Greater saving is associated with O Higher interest rates. O Lower interest rates. There is no...
Greater saving is associated with O Higher interest rates. O Lower interest rates. There is no association between saving and interest rates.
4. Interest rates and their effect on corporate profits and investment prices Interest rates affect corporate profits and security prices. Based on your understanding of the relationship between interest rates and corporate profits and security prices, identify which of the following statements is true and which are false. True False Ststements The higher the interest rate on a firm's debt, the lower will be the firm's profits, all other considerations remaining constant. An increase in the interest rate paid by...
A. Interest rates will be unaffected.
B.
Interest rates will decrease.
C
Interest rates will increase.
D
Interest rates could increase or decrease.
In December 2017, the Trump Administration and the U.S. Congress passed tax reform legislation, the 2017 Tax Cuts and Jobs Act, that cut corporate taxes from 35 percent to 21 percent. Consider the market for money illustrated in the figure below. Assume the market initially (just prior to the legislation) is in equilibrium at point A. What...
Please Help
Incorrect Question 43 0/2 pts Because interest rates on government bonds reflect the risk of default, the historically high bond yields are signaling that government bonds are a risky investment. a country perceived as a higher credit risk can pay lower interest rates when it borrows. bond buyers are willing to accept lower interest payments for bonds perceived as high-risk investments. a country perceived as a higher credit risk must pay higher interest rates when it borrows. Incorrect...
An increase in the wage rate will have a greater effect on average costs a. the larger the proportion labor costs are of total costs and the easier it is to substitute capital for labor. the larger the proportion labor costs are of total costs and the harder it is to substitute capital for labor. the greater is the diminishing marginal product of labor. c. d. the greater are returns to scale.
33. Using the Keynesian model, the effect of a government-imposed ceiling on interest rates paid on personal checking accounts that is lower than the current market interest rate would be to cause __ in the real interest rate and in output in the short run. (a) a decrease; a decrease (b) a decrease; no change (c) a decrease; an increase (d) an increase; a decrease Answer: C Level of difficulty: 3 Section: 11.3
Greater saving is associated with O Higher interest rates. O Lower interest rates. There is no association between saving and interest rates.
Most questions answered within 3 hours.
-
Write a program to solve the Josephus problem, with the following
modification:
Sample Input:
./a.out n...
asked 1 hour ago -
At the start of a CD it is spinning at a rate of 525 rpm
(revolutions...
asked 1 hour ago -
4. Without doing any calculations, predict whether the observed
∆T would increase, decrease or remain the...
asked 2 hours ago -
Based on the range, which of the following sets of scores has
the greatest variability? 3,...
asked 3 hours ago -
Ripples in a pond travel at a velocity of 3 m/s with one peak
passing a...
asked 3 hours ago -
A man stands on the roof of a building of height 13.0 mm and
throws a...
asked 3 hours ago -
The extent to which assets are financed by borrowed funds and
other liabilities is indicated by:...
asked 4 hours ago -
Explain in detail
Germany is the fifth largest economy
explain what goods and services Germany specializes...
asked 5 hours ago -
The density of platinum is 21.45 g/mL. If a cube of platinum
with a mass of...
asked 5 hours ago -
Accounts Receivable
Sales
A/R Posting
Extended Sales Invoice
Packing Slip
Compare invoice to packing slip 2...
asked 5 hours ago -
Michaella, age 23, is a full-time law student and is claimed by
her parents as a...
asked 5 hours ago -
Why are polymers not typically casted into products?
asked 5 hours ago