The Federal Reserve issues a report indicating that future inflation will increase from 3% to 4%....
The Federal Reserve issues a report indicating that future inflation will increase from 3% to 4%. As a result...
A) the demand for loanable funds shifts right. B) the supply curve for bonds shifts left.
C) the equilibrium interest rate falls. D) the equilibrium price of bonds rises.
Homework Answers
As the Fed has reported that the future inflation is going to rise, that means the demand in the economy is increasing and people are demanding more. It will lead to a higher investment in the economy and the demand for the loanable fund will shift to the right. It will decrease the bond price and equilibrium interest rate will fall. and the supply curve of the bonds will shift right.
The answer is "A."
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The Federal Reserve issues a report indicating that future
inflation will increase from 3% to 4%....
10. The real interest rate is the (x) real rate of return to the lender. (y)...
10. The real interest rate is the (x) real rate of return to the lender. (y) real cost of borrowing to the borrower. (z) nominal interest rate plus the rate of inflation. A. (x), (y) and (z) B. (x) and (y) only C. (x) and (z) only D. (y) and (z) only E. (z) only 13. If there is a shortage of loanable funds, then A. neither curve shifts, but the quantity of loanable funds supplied decreases and the quantity...
Please help me answer all greatly appreciated. Thumbs up a rise in demand for loanable funds...
Please help me answer all greatly appreciated. Thumbs up
a rise in demand for loanable funds by a large country can result fall in interest rates Ono change in interest rates O an increase in the interest rate Onone of the answers are correct if wealth increases the loanable funds supply curve shifts to the right true false If you expect prices to continue to fall since they have been falling in the past three months, your are exhibiting adaptive...
20. In the bond market, the bond demanders are the and the bond suppliers are the...
20. In the bond market, the bond demanders are the and the bond suppliers are the A) lenders: borrowers B) lenders, advancers C) borrowers; lenders D) borrowers, advancers 21. The demand curve for bonds has the usual downward slope, indicating that at prices of the bond, everything else equal, the is higher. A) higher; demand B) higher, quantity demanded C) lower; demand D) lower; quantity demanded 22. Everything else held constant, if interest rates are expected to fall in the...
oanable funds increase What would make both the equilibrium interest rate and the equilibrium quantity of...
oanable funds increase What would make both the equilibrium interest rate and the equilibrium quantity of loanable funds increase? 10 a. The supply of loanable funds shifts right. O b. The supply of loanable funds shifts left. O c. The demand for loanable funds shifts right. O d. The demand for loanable funds shifts left.
1. If people expect higher inflation in the near future, the expected return on bonds rises/falls), and the deman...
1. If people expect higher inflation in the near future, the expected return on bonds rises/falls), and the demand for money (increases/decreases), leading to the rate of interest increasing/decreasing). 2. For the following questions, fill in the blanks below with: rises/falls/right/left/increase/decrease a. When real income increases, the demand curve for money shifts to the the interest rate _, everything else held constant. and b. A business cycle expansion increases income, causing money demand to interest rates to , everything else...
For some reason, the expectations for future inflation increases dramatically. what effect would this have on...
For some reason, the expectations for future inflation increases
dramatically. what effect would this have on the loanable funds
market?
A. The demand for loanable funds would increase thus increasing
the interest rate level.
B, The demand for loanable funds would decrease thus increasing
the interest rate level.
C. The Supply for loanable funds would increase thus increasing
the interest rate level.
D. The Supply for loanable funds would decrease thus decreasing
the interest rate level.
2. For some reason,...
9. Refer to the Figure13-2. If the economy were initially in equilibrium at r0 and E0...
9. Refer to the Figure13-2. If the economy were initially in equilibrium at r0 and E0 and the government removed import quotas, what would happen to the exchange rate? a. It would appreciate to E1. b. It would appreciate to E2. c. It would depreciate to E1. d. It would depreciate to E2. ____ 10. When a country experiences capital flight, which of the following best explains the effects? a. The interest rate falls because the demand for loanable funds shifts left....
In the open-economy macroeconomic model, if the supply of loanable funds shifts right Group of answer...
In the open-economy macroeconomic model, if the supply of loanable funds shifts right Group of answer choices the interest rate falls and the supply of dollars in the market for foreign-currency exchange shifts right. the interest rate falls and the supply of dollars in the market for foreign currency exchange shifts left. the interest rate rises and the demand for dollars in the market for foreign currency exchange shifts right. the interest rate rises and the demand for dollars in...
22. If the expected returns on commodities falls, while the expected returns on bonds do not...
22. If the expected returns on commodities falls, while the expected returns on bonds do not change, then A) the demand curve for bonds will shift to the left. B) the supply curve for loanable funds will shift to the right. C) the equilibrium interest rate will fall. D) the equilibrium price will rise.
On March 15, 2017, Federal Reserve Chairman Janet L. Yellen announced the Federal Reserve was raising...
On March 15, 2017, Federal Reserve Chairman Janet L. Yellen announced the Federal Reserve was raising its benchmark rate (the federal funds rate) by a quarter of a percentage point (to a range of 0.75-1.00 percent). This was the third time the Fed has raised rates after the Great Recession. Consider the market for money illustrated in the figure below. Assume the market initially just prior to March 15, 2017) is in equilibrium at point A. Describe the effects of...
Please help me answer all greatly appreciated. Thumbs up
a rise in demand for loanable funds by a large country can result fall in interest rates Ono change in interest rates O an increase in the interest rate Onone of the answers are correct if wealth increases the loanable funds supply curve shifts to the right true false If you expect prices to continue to fall since they have been falling in the past three months, your are exhibiting adaptive...
20. In the bond market, the bond demanders are the and the bond suppliers are the A) lenders: borrowers B) lenders, advancers C) borrowers; lenders D) borrowers, advancers 21. The demand curve for bonds has the usual downward slope, indicating that at prices of the bond, everything else equal, the is higher. A) higher; demand B) higher, quantity demanded C) lower; demand D) lower; quantity demanded 22. Everything else held constant, if interest rates are expected to fall in the...
oanable funds increase What would make both the equilibrium interest rate and the equilibrium quantity of loanable funds increase? 10 a. The supply of loanable funds shifts right. O b. The supply of loanable funds shifts left. O c. The demand for loanable funds shifts right. O d. The demand for loanable funds shifts left.
1. If people expect higher inflation in the near future, the expected return on bonds rises/falls), and the demand for money (increases/decreases), leading to the rate of interest increasing/decreasing). 2. For the following questions, fill in the blanks below with: rises/falls/right/left/increase/decrease a. When real income increases, the demand curve for money shifts to the the interest rate _, everything else held constant. and b. A business cycle expansion increases income, causing money demand to interest rates to , everything else...
For some reason, the expectations for future inflation increases
dramatically. what effect would this have on the loanable funds
market?
A. The demand for loanable funds would increase thus increasing
the interest rate level.
B, The demand for loanable funds would decrease thus increasing
the interest rate level.
C. The Supply for loanable funds would increase thus increasing
the interest rate level.
D. The Supply for loanable funds would decrease thus decreasing
the interest rate level.
2. For some reason,...
22. If the expected returns on commodities falls, while the expected returns on bonds do not change, then A) the demand curve for bonds will shift to the left. B) the supply curve for loanable funds will shift to the right. C) the equilibrium interest rate will fall. D) the equilibrium price will rise.
On March 15, 2017, Federal Reserve Chairman Janet L. Yellen announced the Federal Reserve was raising its benchmark rate (the federal funds rate) by a quarter of a percentage point (to a range of 0.75-1.00 percent). This was the third time the Fed has raised rates after the Great Recession. Consider the market for money illustrated in the figure below. Assume the market initially just prior to March 15, 2017) is in equilibrium at point A. Describe the effects of...
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