Homework Answers
1. The answer should be false . As a project is acceptable if the present value of future cash flows is more than the investment cost because then only it will mean that the project is giving positive outputs and is able to cover the investment cost.
2.Your answer is correct.
3.Your answer is correct.
4.Your answer is correct.
5. Your answer is correct.
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Please check my answers? Are my answers correct and if not please explain why? 1. A...
Please check my answers and explain if they are wrong? 1. If Japanese interest rate goes...
Please check my answers and explain if they are wrong?
1. If Japanese interest rate goes up and US interest rate remains unchanged, 2. According to Fisher effect, if nominal interest rate goes up by 1%, then 3. According to Fisher effect, if expected inflation rate goes up by 1%, then 4. If expected inflation rate goes up, the supply curve for loanable fund will 5. If expected inflation rate goes up, the supply curve for loanable fund will then...
i need answers and explanations 35. With the low unemployment rate, households become more optimistic about...
i need answers and explanations
35. With the low unemployment rate, households become more optimistic about the future economy and decide to increase their spending on durable goods such as automobiles. According to the model of the market for loanable funds, A) real interest rate and the quantity of loanable funds will remain unchanged. B) real interest rate will increase and the quantity of loanable funds will decrease. C) real interest rate will decrease and the quantity of loanable funds...
If the process of coming back to present value (PV) from future cash flows is called...
If the process of coming back to present value (PV) from future cash flows is called discounting, then the process of going to future value (FV) from present value (PV) is called compounding. (TRUE/FALSE)?_______________________ For a corporate bond, the quoted interest rate minus the real risk-free rate is equal to which of the following? Nominal interest rate Real inflation rate plus nominal interest rate Market risk premium The sum of inflation premium, default risk premium, liquidity premium and maturity risk premium
5. Inflation and the nominal interest rate The following graph shows the supply and demand curves...
5. Inflation and the nominal interest rate The following graph shows the supply and demand curves in the market for loanable funds when actual inflation and expected inflation are zero. Suppose the expected inflation rate increases to 4%. Adjust the following graph to show the effect of this increase in the expected inflation rate. INTEREST RATE 500 100 200 300 400 QUANTITY OF LOANABLE FUNDS An expected inflation rate of 4% results in a nominal interest rate of and a...
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...
In a different scenario, suppose that the demand and supply curves for loanable funds shown on...
In a different scenario, suppose that the demand and supply curves for loanable funds shown on the following graph occur when the expected future inflation rate is 5%. Then, a sudden shock to the economy causes the expected future inflation rate to rise to 9.6%. Assuming the Fisher effect holds, show the impact that this will have on the loanable funds market by shifting one or both curves on the following graph Tool tip: Click and drag one or both...
If the rate of inflation increases from 3% to 6%, we would most likely expect that...
If the rate of inflation increases from 3% to 6%, we would most likely expect that nominal interest rates will remain unchanged and the real interest rate will increase by 3%. nominal interest rates will increase by 6% and the real interest rate will fall by 3%. nominal interest rates will remain unchanged and the real interest rate will also remain unchanged as the risk of default will most likely increase. nominal interest rates, real interest rates and risk of...
please help me to answer all quations write all the answers on the answer sheet) I...
please help me to answer all quations
write all the answers on the answer sheet) I multiple choices (10 points, 1 point for each question) 1. Which of the following is included in GDP?( A the production that you hire someone to mow your lawn B the production that you mow your own lawn C the production that you produce goods and services abroad 2. In the GDP accounting, investment the purchases of bonds B the purchases of stocks C...
Please check my work for the first photo as well! options are (borrow and lend where...
Please check my work for the first photo as well! options are
(borrow and lend where i selected borrow).
she can Invest up to $2,000. Here are the rates of return Three students have each saved $1,000. Each has an investment opportunity in which he on the students' investment projects: Student Darnell Jacques Return (Percent) 8 13 Kyoko 24 Assume borrowing and lending is prohibited, so each student finance his or her own investment project. Complete the following table with...
True false or uncertain and explain in 3 sentences why? 1)An increase in world supply of...
True false or uncertain and explain in 3 sentences why? 1)An increase in world supply of crude oil will (at some point) lead to a decrease in the price of plastic. [Hint: Crude oil byproducts are an input to the production of plastic.] 2)The measured unemployment rate can only decrease if some of those unemployed get jobs and become counted as employed. 3)If the CPI increases from 150 to 153, the inflation rate is 2%. So if your savings account...
Please check my answers and explain if they are wrong?
1. If Japanese interest rate goes up and US interest rate remains unchanged, 2. According to Fisher effect, if nominal interest rate goes up by 1%, then 3. According to Fisher effect, if expected inflation rate goes up by 1%, then 4. If expected inflation rate goes up, the supply curve for loanable fund will 5. If expected inflation rate goes up, the supply curve for loanable fund will then...
i need answers and explanations
35. With the low unemployment rate, households become more optimistic about the future economy and decide to increase their spending on durable goods such as automobiles. According to the model of the market for loanable funds, A) real interest rate and the quantity of loanable funds will remain unchanged. B) real interest rate will increase and the quantity of loanable funds will decrease. C) real interest rate will decrease and the quantity of loanable funds...
5. Inflation and the nominal interest rate The following graph shows the supply and demand curves in the market for loanable funds when actual inflation and expected inflation are zero. Suppose the expected inflation rate increases to 4%. Adjust the following graph to show the effect of this increase in the expected inflation rate. INTEREST RATE 500 100 200 300 400 QUANTITY OF LOANABLE FUNDS An expected inflation rate of 4% results in a nominal interest rate of and a...
In a different scenario, suppose that the demand and supply curves for loanable funds shown on the following graph occur when the expected future inflation rate is 5%. Then, a sudden shock to the economy causes the expected future inflation rate to rise to 9.6%. Assuming the Fisher effect holds, show the impact that this will have on the loanable funds market by shifting one or both curves on the following graph Tool tip: Click and drag one or both...
please help me to answer all quations
write all the answers on the answer sheet) I multiple choices (10 points, 1 point for each question) 1. Which of the following is included in GDP?( A the production that you hire someone to mow your lawn B the production that you mow your own lawn C the production that you produce goods and services abroad 2. In the GDP accounting, investment the purchases of bonds B the purchases of stocks C...
Please check my work for the first photo as well! options are
(borrow and lend where i selected borrow).
she can Invest up to $2,000. Here are the rates of return Three students have each saved $1,000. Each has an investment opportunity in which he on the students' investment projects: Student Darnell Jacques Return (Percent) 8 13 Kyoko 24 Assume borrowing and lending is prohibited, so each student finance his or her own investment project. Complete the following table with...
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