Identify the effect of recession in the economy on either demand or supply curve and the equilibrium interest rates. kindly use a graph in your explanation.
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Identify the effect of recession in the economy on either
kindly use a graph in your explanation.
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- Identify the effect of recession in the economy on either demand or supply curve and the equilibruim interest rates.Explain using a diagramTo determine how U.S. interest rates reacted to this announcement, use the FRED database at thelink referenced above and choose the weekly format. a.) Adjust the graph to see what happened to the interest rate in the week including May 16,1995. How does this movement in the interest rate compare with neighboring weeks,specifically the preceding week and the subsequent week? In your answer to thisquestion, please include a copy of the graph. b.) What type of retaliation by the government of Japan for the proposed tariff canexplain this change in interest rates? Explain why Japanese retaliation would result inthis change in interest rates. c.) About one month later, President Clinton announced that the two countries had reachedan agreement, which ended the threat of the tariffs being imposed. What happened to the interest rates during the month of June? In your answer to this question, pleaseinclude a copy of the graph. Please explain why averting a trade war would have thiseffect on the…Suppose the U.S. Treasury issued $50 billion of short-term securities and sold them to the public. Other things held constant, what would be the most likely effect on short-term securities' prices and interest rates? a. Prices and interest rates would both rise. b. Prices would rise and interest rates would decline. c. Prices and interest rates would both decline. d. Prices would decline and interest rates would rise. e. There is no reason to expect a change in either prices or interest rates.
- Q1.Table shows the amount of savings and borrowing in a market, measured in millions of dollars, at various interest rates. What is the equilibrium interest rate and quantity in the capital financial market? Now, imagine the supply curve shifts so that there will be $5 million more supplied at every interest rate. Calculate the new equilibrium interest rate and quantity, and explain the situation: the reasons of increase of supply and what new equilibrium mean Interest rate Qs Qd 5 200 470 6 270 320 7 300 300 8 350 250 9 400 200 10 500 100If the equilibrium price of bonds increases, what happens to the associated interest rate? A. Interest rate increases B. Interest rate declines C. Interest rate does not changeWhat effect will a sudden increase in the volatility of gold prices have on interest rates? Explain your answer with a graph.
- Table shows the amount of savings and borrowing in a market, measured in millions of dollars, at various interest rates. What is the equilibrium interest rate and quantity in the capital financial market? Now, imagine the supply curve shifts so that there will be $50 million less supplied at every interest rate. Calculate the current and the new equilibrium interest rate and quantity, and explain the situation: the reasons of decrease of supply and what new equilibrium mean. Interest rate Qs Qd 5 200 470 6 270 320 7 320 320 8 350 300 9 400 200 10 500 100Suppose a new process was developed that could be used to make oil out of seawater. The equipment required is quite expensive, but it would in time lead to low prices for gasoline, electricity, and other types of energy. What effect would this have on interest rates? (Hint: which direction does demand curve shift? How does it change savings and investment in the economy?)What does this mean? "When drawn against the real interest rate, output supply increases if the labor supply is increasing in the interest rate."
- Q4 a) When the demand of output decides how much to produce which type of demand prevails in the economy? B) Why investment is negatively related to interest rate?c) Give the equilibrium in the market for loans?Question: Suppose that many big corporations decide not to issue bonds, since it is now too costly to comply with new financial market regulations. Can you describe the expected effect on interest rates? Illustrate your answer with a diagram.Suppose that people in France decide to permanently increase their savings rate. Predict what will happen to the French bond market in the future. Please answer the question by drawing the appropriate supply-and-demand diagram.
