Group member Name : Huajiu LI Student ID : LIHD1401 Sala uddin Khan KHANSD1302 Assignment
Figure 23.2.5
1) Refer to Figure 23.2.5. In Figure 23.2.5, the supply of loanable funds curve is SLF0 and the demand for loanable funds curve is DLF0. An expansion that increases disposable income and expected profit will lead to a higher or lower real interest rate, why?
The answer: 1)First of all, other things remaining the same, the greater the expected profit from the new capital, the greater is the amount of the investment and the greater the demand for loanable funds. So an increase in expected profit will shift loanable demand to right . As we can see
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Compared with the domestic supply, the cost of borrowing from the world will lower. So, this country prefer borrow money from the world supply. In conclusion , the money will flow from the lower interest rate country to the higher interest rate country.
4) Briefly describe money’s function from the view of economists and write down the definition of M1 and M2.
The answer: Money’s function:
1) a means of payment: a method of settling a debt.
2)medium of exchange A medium of exchange is an object that is generally accepted in exchange for goods and services.
3) unit of value: an agreed measure for stating the prices of goods and services.
4) store of value: money can be held for a time and later exchanged for goods and services.
M1: currency plus chequable deposits held by individuals and business.
M2: M1 puls all other deposits - non- chequable deposits and fixed term deposits.
5) How do banks create money multipliers? List the whole process of doing it.
The money multiplier is the ratio of the change in the quantity of money to the change in the monetary base( notes,coins and bank’s deposits at the Bank of Canada). The money multiplier depends on the
This final exam is to be taken on the honor system. Take the exam without opening books, lecture notes or other source material. When completed, email it to the instructor and the TA and you will receive a confirmation email that it was received.
Jim doesn’t think he can agree to the union’s language on contracting out because as written it could severely limit the company’s flexibility. What language, if any, should Jim propose to attempt to resolve this issue? (10 marks)
You have used money to measure the price, the size of business, total output in the economy, and income. Coins and paper money are called currency. People use currency daily. When you go to a movie, you probably buy a ticket with currency. Coins and paper money work well for small purchases and when payment is made directly from one person to another. But, for large purchases or when payments travels to mail, currency is not practical. A check is a written order to pay money from amounts deposited. Therefore, deposits in checking accounts, credit union share draft accounts, and other similar accounts are considered money. Remember that the most important function of money is as a
A measure of the money supply which combines any liquid or cash assets held within a central bank and the amount of physical currency circulating in the economy. The money supply is divided into two distinct categories: M1—assets that can be easily accessed and immediately used to purchase goods and service. These are referred to as liquid assets. Money deposited in checking accounts meets this criteria because checks represent demand deposits, as they are paid “on demand” for the cash in the account. This is money which is available immediately for spending and therefore fulfills the medium of exchange function of money. M2—all of M1 and assets that cannot be used directly as cash but can be easily be converted to cash. This monetary aggregate
- exchange is the trade of things of value between buyer and seller so that each is better off after the trade
To reduce money supply for fighting inflation the Central Bank can also raise cash reserve ratio of the banks. The higher cash reserve ratio implies that the banks have to keep more cash reserve with the Central Bank. As a result, the cash reserves with the banks fall which force them to contract credit. With this money supply in the economy
“Money is a means of payment, store value, and a unit of account” (Case, Fair, & Oster 2011). Money is our economy’s barter. Instead of providing goods and services to get other good and services, money is that form of exchange. For example, you can easily go to the store with money and buy a gallon of milk. Money is a store of value; for instance gold and silver. Money gives purchasing power from one period to another, in other words it can be (look for “USED”)r ver time. As mention in the class lectures, we rely on checking and saving accounts for this. Money is a unit of account; it provides a common base for prices. We can add up goods to their dollar and cent value.
Money is a term that shows every description of coin or bank-notes recognized by a consent as a representative of value effecting exchanges of property and payment debts. M1 consists of currency outside the U.S. Treasury, Federal Reserve Banks, and
Mendler (cited in Charles and Senter, 2005, p. 136) states that when educators respond to misbehaviour, children may fight back and a power struggle will begin. To avoid this, educators must allow for ration discussion of the inappropriate behaviour, which cannot be done if the educator embarrasses or angers the child. When responding to inappropriate behaviour in an early childhood setting, I would focus on active listening without judgement, as this helps the child feel important and they feel encouraged to solve their problems. I would also use private dialogue with a PEP strategy. This involves using privacy, eye contact, and proximity (Mendler,
Scott Adams shares with us the ideal framework for an entrepreneurial curriculum. In his article How to Get a Real Education, he reinforces the fact that the whole is far greater than the sum of these parts, especially in the context of an entrepreneur. Adams tells us of a couple stories from when he was in college and how he used the skills of an entrepreneur to become successful. He saw opportunities, sometimes embedded within problems, and worked them to his favor. This is what he referred to when speaking of the learned skill of transforming “nothing into something”, which is a skill that obviously applies to business. His basic idea is that much academic-oriented education is wasted on many
Money is considered to be a medium of exchange, a unit of account, and a store of value. Medium of exchange means that money is the intermediary instrument that facilitates the exchange of goods. It is also considered to be a unit of account which means it is something that can be used for value for goods and services, record debts, and make calculations. A unit of account, is divisible, fungible, and countable. Lastly money is classified as a store of value meaning it can be stored away through savings and keep its value for later use. The creation of money occurred because of the complexity of exchange in ancient times. Goods and services were exchanged; however, they were unbalanced. Some valued items or services as higher than others. This flaw in the barter exchange led to the invention of an economic system with money as the focus so there was a set value.
In the interdependent social world that we live in, both individuals and groups rely upon the help they receive from other individuals or groups. In Lesson Ten’s short story, “Class Notes”, two college students will have to miss significant class time in an upcoming course. The college students, Jesses and Geoff, are faced with the issue of finding a fellow student who will share with them their notes. Jesse and Geoff take divergent approaches and receive contrasting results.
Money supply is the aggregate amount of money in the economy (in its various forms, with varying
A: All societies have some form of money because it makes economic transactions much more convenient and efficient. The purpose of money can be simplified into two main concepts including unit of account and store of value. Money serves as a unit of account which means
1. Value is the customer's perception of all of the benefits of a product or service weighed against all the costs of acquiring and consuming it. The mileage of a car would be considered as a(n):