Q6) option D)
Higher loan processing costs, so need to have higher interest rate to cover these costs, thus higher is nominal interest rate
7) option A)
Maturity amount = 10,000(1+.03)3
= 10927.27
8) option B)
Since grain Consumption will fall, so production will fall
Thus land rents will fall
9) option E)
As demand for loans rises , it's due to fall in interest rate
Also new production methods are available,so now funds are needed
QUESTION 6 The higher a higher, lower O b. lower, lower the nominal interest rate. st...
All Hassan Al Ahm SNC Moodle d. the nominal interest rate During the Christmas shopping season, the demand for money increases significantly. If the Fed takes no actions to offset the increase in money demand, then nominal interest rates will Finish attempt. 18 Time left 1:06:54 Not yet andnered Points out of Select one: Oa. decrease F Rag b, remain constant c, equal the real interest rates O d. increase Gueston 19 Not yet anseered Paints out of Prior to...
This Question: 2 pts 29 of 62 (44 comp At higher interest rates the O A. quantity of money demanded is lower. O B. quantity of money demanded is higher. O C. money supply is indeterminate. O D. money supply is higher. Click to select your answer
Question 9 (1 point) If the actual interest rate is below the equilibrium interest rate, the Federal Reserve must intervene in financial markets to restore the interest rate to its equilibrium value O price of bonds will increase O price of bonds will decrease money supply will increase until the interest rate rises money supply will decrease until the interest rate rises Question 10 (1 point) In the short-run macro model, a decrease in the money supply will O result...
To decrease the money supply, the Bank of Canada could O a) lower the bank rate. O b) lower the required reserve ratio. O c) sell government securities. d) purchase government securities. An increase in interest rate in the economy will have what effect on macroeconomic equilibrium in the long run? a) The price level will rise, and the level of output will fall. b) The price level will rise, and the level of output will be equal to the...
1. If the long-run Phillips curve shifts to the right, for any given rate of money growth and inflation the economy will have a. higher unemployment and higher output.b. higher unemployment and lower output.c. lower unemployment and higher output.d. lower unemployment and lower output.
9. Suppose that a borrower and a lender agree on the nominal interest rate to be paid on a loan. Then infla- tion turns out to be higher than they both expected. a. Is the real interest rate on this loan higher or lower than expected? b. Does the lender gain or lose from this unexpectedly high inflation? Does the borrower c. Inflation during the 1970s was much higher than most people had expected when the decade began. How did...
why choose d? 28. Recently, the Federal Reserve is considering raising the interest rate for the first time since 2006. Which of the following would result in the short run if the interest rate is increased? . A lower inflation rate I A decrease in the money supply I A higher unemployment rate a. I and b. Il and III c. Iand IlI d. I, II, and ill 28. Recently, the Federal Reserve is considering raising the interest rate for...
1. The level of aggregate output demanded rises when the price level falls, because the resulting decrease in the interest rate will lead to a. higher investment spending and higher consumption spending.b. lower investment spending and higher consumption spending.c. higher investment spending and lower consumption spending.d. lower investment spending and lower consumption spending.
Question 31 2 pts In a small open-economy, assume short-run equilibrium levels of output are below the natural rate of output. Going from the short-run to the long-rurn equilibrium, output will land prices will decrease; decrease decrease; increase increase; decrease increase: increase Question 32 2 pts Based on the below graph, if the economy starts from a short-term equilibrium at Point A, then the long-run equilibrium will be at-_ with a __ price level. Exhibit: Short Run to Long Run...
Why is the AD curve downward? sloping pick one answer below: A. The higher interest rate produced by a lower price level leads to more consumption? spending, investment? spending, and net exports. B. An increase in the price level decreases real money? balances, which raises the interest rate. The higher interest rate decreases consumption? spending, investment? spending, and net exports. C. AD slopes downward for the same reasons the demand for an individual good slopes? downward: because of income and...