Homework Answers
Ans
1 +5350-5000/5000 (100)=7%
2 =So price rose by 2% from 100 to 200.so real =nominal-inflation=7-2=5%
3 worse off because real=5% only compared to expected value of 7-1=6%
Add Answer to:
Real vs. Nominal Interest Rates. Suppose the nominal value of your savings increased from $5000 t...
Suppose you put $100 in the bank on January 1, 2017. If the annual nominal interest rate is 5 per...
Suppose you put $100 in the bank on January 1, 2017. If the annual nominal interest rate is 5 percent and the inflation rate is 5 percent, you will be able to buy ________ worth of inflation-adjusted goods on January 1, 2018. a. $110 b. $95 c. $100 d. $105 e. $90 Practically, in the long run the real interest rate is equal to: a. a savings account. b. the marginal product of capital. c. the rate of return to...
you will receive $100 from a zero-coupon savings bond in 2 years. The nominal interest rate...
you will receive $100 from a zero-coupon savings bond in 2 years. The nominal interest rate is 8.10%. If the inflation rate over the next few years is expected to be 3.10%, what will the real value of the $100 payoff be in terms of today’s dollars? (Do not round intermediate calculations. Round your answer to 2 decimal places.) -answer is $94.08.. but my Q is this.... d. Show that the real payoff from the bond [from part (b)] discounted...
You will receive $100 from a zero-coupon savings bond in 3 years. The nominal interest rate...
You will receive $100 from a zero-coupon savings bond in 3 years. The nominal interest rate is 7.80%. a. What is the present value of the proceeds from the bond? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Present Value: b. If the inflation rate over the next few years is expected to be 2.80%, what will the real value of the $100 payoff be in terms of today’s dollars? (Do not round intermediate calculations. Round...
You are given the following information about your nominal salary and the CPI . (For numerical...
You are given the following information about your nominal
salary and the CPI . (For numerical answers below, circle your
answers or put them in a table.)
Nominal Salary | СРІ 2018 $50,000 100 2019 $51,000 101 2020 $52,000 105 A. Calculate both the inflation rate and growth in nominal salary between 2018-2019 and 2019- 2020. B. For each year, calculate your real salary. What is the growth (percentage change) in your real salary? C. Using the approximation provided in...
You will receive $100 from a zero-coupon savings bond in 3 years. The nominal interest rate...
You will receive $100 from a zero-coupon savings bond in 3 years. The nominal interest rate is 8%. a. What is the present value of the proceeds from the bond? (Do not round intermediate calculations. Round your answer to 2 decimal places.) b. If the inflation rate over the next few years is expected to be 3%, what will the real value of the $100 payoff be in terms of today’s dollars? (Do not round intermediate calculations. Round your answer...
You will receive $100 from a zero-coupon savings bond in 4 years. The nominal interest rate...
You will receive $100 from a zero-coupon savings bond in 4 years. The nominal interest rate is 8.20%. a. What is the present value of the proceeds from the bond? (Do not round intermediate calculations. Round your answer to 2 decimal places.) b. If the inflation rate over the next few years is expected to be 3.20%, what will the real value of the $100 payoff be in terms of today’s dollars? (Do not round intermediate calculations. Round your answer...
Suppose you are considering putting your savings in an investment fund. Scenario A projects stable prices,...
Suppose you are considering putting your savings in an investment fund. Scenario A projects stable prices, and therefore, low returns Scenario B involves high inflation and, consequently, high returns. In both cases, the capital earnings tax rate is 24.0%. Calculate the nominal and real after-tax returns for both scenarios. Please include at least two numbers after the decimal point for your answers. Do not round your answers Scenario Inflation Nominal rate of return 6.00% 18.50% 2.5% In Scenario A, what...
short answer required 3. Suppose that velocity of money and output are . Gulf constant and the fresher effect both hold what happens to inflation real interest rate and nominal interest rate when...
short answer required
3. Suppose that velocity of money and output are . Gulf constant and the fresher effect both hold what happens to inflation real interest rate and nominal interest rate when the money supply growth rate increases from (096) to (5%)? 4. Why might a favorable change to the economy such as technological change or a decrease in the price of imported oil be associated with an increase frictional unemployment? 5. How young population effect economic development? 6....
Question 1 1 pts Suppose that nominal GDP increased in Econland from $10 Billion to $12...
Question 1 1 pts Suppose that nominal GDP increased in Econland from $10 Billion to $12 Billion (what is that percentage change? You will need to figure that out to answer the rest of the question!) The inflation rate in Econland during this time was 5% What happened to Real GDP Growth in Econland? (give the BEST answer) It grew by 15% It grew by 50% It grew by 25% It grew by 2%
all of them please <3 2) Suppose you are presented with the following table, where all...
all of them please <3
2) Suppose you are presented with the following table, where all figures are rendered in billions of dollars: MMMF Reserves Small time deposits Savings deposits 7,700 8,200 Year Currency 2017 1,270 2018 1.330 Demand deposits 1,200 1,220 2,400 600 720 505 2,500 602 a. What is the monetary base in this economy in 2017 and 2018? b. What is M1 in this economy in 2017 and 2018? C. What is M2 in this economy in...
You are given the following information about your nominal
salary and the CPI . (For numerical answers below, circle your
answers or put them in a table.)
Nominal Salary | СРІ 2018 $50,000 100 2019 $51,000 101 2020 $52,000 105 A. Calculate both the inflation rate and growth in nominal salary between 2018-2019 and 2019- 2020. B. For each year, calculate your real salary. What is the growth (percentage change) in your real salary? C. Using the approximation provided in...
Suppose you are considering putting your savings in an investment fund. Scenario A projects stable prices, and therefore, low returns Scenario B involves high inflation and, consequently, high returns. In both cases, the capital earnings tax rate is 24.0%. Calculate the nominal and real after-tax returns for both scenarios. Please include at least two numbers after the decimal point for your answers. Do not round your answers Scenario Inflation Nominal rate of return 6.00% 18.50% 2.5% In Scenario A, what...
short answer required
3. Suppose that velocity of money and output are . Gulf constant and the fresher effect both hold what happens to inflation real interest rate and nominal interest rate when the money supply growth rate increases from (096) to (5%)? 4. Why might a favorable change to the economy such as technological change or a decrease in the price of imported oil be associated with an increase frictional unemployment? 5. How young population effect economic development? 6....
Question 1 1 pts Suppose that nominal GDP increased in Econland from $10 Billion to $12 Billion (what is that percentage change? You will need to figure that out to answer the rest of the question!) The inflation rate in Econland during this time was 5% What happened to Real GDP Growth in Econland? (give the BEST answer) It grew by 15% It grew by 50% It grew by 25% It grew by 2%
all of them please <3
2) Suppose you are presented with the following table, where all figures are rendered in billions of dollars: MMMF Reserves Small time deposits Savings deposits 7,700 8,200 Year Currency 2017 1,270 2018 1.330 Demand deposits 1,200 1,220 2,400 600 720 505 2,500 602 a. What is the monetary base in this economy in 2017 and 2018? b. What is M1 in this economy in 2017 and 2018? C. What is M2 in this economy in...
Most questions answered within 3 hours.
-
How much must I invest today if I want to withdraw 1/3 of my
original investment...
asked 1 hour ago -
What is meant by a “term premium”?
What can explain such a premium? Is it a...
asked 3 hours ago -
23. Which molecule has only covalent bonds? A. CO2 B. Al2O3 C.
Mg3N2
24. The octet...
asked 3 hours ago -
the
total pressure for a mixture of N2O4 and NO2 is 2.20 atm. If Kp=
7.10...
asked 3 hours ago -
Delaware Corp. prepared a master budget that included $22,385
for direct materials, $28,600 for direct labor,...
asked 3 hours ago -
For pesticide HCB (hexachlorobenzene), its logarithmic partition
coefficient log Kow is 5.6. What would be the...
asked 3 hours ago -
A chemist requires 0.422 mil Na2CO3 for a reaction. How many
grams does this correspond to?
asked 4 hours ago -
If the vapor pressure of carvone is approximately 9.4 torr at 99
°C, approximately how much...
asked 4 hours ago -
A juice bottling company is carrying out a test at 10%
significance that the mean population...
asked 4 hours ago -
What is the reflectivity (in percent) needed to keep water at a
temperature near its freezing...
asked 4 hours ago -
Suppose that the average surface temperature of Earth is 300K.
Assume this is uniform over its...
asked 4 hours ago -
Draw the condensed structural formula for alkenes and alkynes or
the line-angle structural formula for cycloalkenes...
asked 4 hours ago