Homework Answers
7.
There is an inverse relationship between the interest rate and investment in housing. A lower interest rate, encourages people to borrow more and it increases investments in housing, because funds are cheaply available and vice versa. Similarly, a lower interest rate, increases business investments as funds are available at an attractive rates.
Both of these investments increase
the demand of funds, that can cause the demand curve of funds to
shift to the right. It increases the interest rates also. So, after
a period of investments of these types, interest rate will
increase.
Add Answer to:
Explain the relationship between interest rates and (1) investments in housing, and (2) business investments. 7....
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Explain the 4 tools of monetary policy and how they impact interest rates, financial markets, housing, and GDP (20 points). Make sure to include the money graph. I need the graph for Financial markets and Housing.
Explain the 4 tools of monetary policy and how they impact interest rates, financial markets, housing,...
Explain the 4 tools of monetary policy and how they impact interest rates, financial markets, housing, and GDP. Make sure to include the money graph. --answer with graph displaying the increase and decrease effect to the interest rates each tool has.
The relationship between interest rates and bond maturity is called: A) Liquidity premium B) Yield to...
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39. The risk structure of interest rates is A. The relationship among interest rates of different...
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Impact of interest rates on bonds
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31. Discuss the relationship between the Gap and the change in net interest income when interest rates decreased. W...
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31. Discuss the relationship between the Gap and the change in net interest income when interest rates decreased. Why did Net Interest Margin increase or decrease?
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