Question 15 Prime interest rate refers to the lowest rate charged by bank to their most important and reliable business borrowers. It fluctuates based on the supply-and-demand relationship for short term funds. True False

Question 15 Prime interest rate refers to the lowest rate charged by bank to their most important and reliable business borrowers. It fluctuates based on the supply-and-demand relationship for short term funds. True False

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter17: Capital And Time

Section: Chapter Questions

Problem 17.2P

See similar textbooks

Related questions

Q: What aspects & principles characteristic of non-market systems are important in our market economy?

A: A non-market system is an administered price system in which the prices of properties are set by an…

Q: Please cite the given and provide solutions on how to arrive at the highlighted answer.

A: A lease payments is the monthly equivalent of rent that is explicitly stipulated under a binding…

Q: Adam Smith argued that the division of labor and specialization give rise to a need for which in…

A: In his famous book The Wealth of Nations, Adam Smith introduces the division of labor and…

Q: A trust will pay you $50,000 per year for 30 years starting 1 year from now. Assuming an interest…

A: Cash flow is the movement of money in and out of a company. Cash received signifies inflows, and…

Q: Consider Thailand's economy, which is characterized by a total population of 21,800,000. 467,000…

A: The economies around the globe are majorly involved in the economic, as well as financial…

Q: 1. Using general equilibrium analysis, and taking into account feedback effects, analyze the…

A: When demand and supply are in balance(equal to each other), the market is said to be in equilibrium.…

Q: What are the potential issues with fiscal policy?

A: The use of govt spending and taxation policies to impact economic circumstances, particularly…

Q: Poverty is rooted in the social structure. How does the social structure in the United States…

A: Poor people are the ones who are not able to meet their daily expenses or are unable to meet their…

Q: A sharp stock market decline increases moral hazard incentives 1) since lending firms have less to…

A: Financial Crisis is the major disruption in the market which is expressed by decline in the prices…

Q: H(E) = aE – bE?, with a, b representing positive constants and E is fishing effort. Total cost is…

A: (C) Fisheries are renewable resources that may become extinct due to indiscriminate harvesting.…

Q: 01. Two alternatives have the following cash flows: alternative End of Year A B – $2000 + $800 +…

A: Present Values: Net present value of Alternative A = 800(P/A, 12%, 4) - 2000= 800…

Q: Discuss two (2) cases of price elasticity of demand. Use diagrams to motivate your answer.

A: Below is the formula for price elasticity of demand: Ep = dQ/QdP/P

Q: Consider an equilibrium of a single product market jointly determined by a supply function q* = a, +…

A: Given, Supply function : q*=ao+a1*p*+UDemand function : q*=β0+β1*p*+Vwhere q* is the equilibrium…

Q: Margin trading occurs when a ________. Question 2 options: A) broker does not charge…

A: Margin refers the percentage of equity of an investor. Central bank has set the minimum requirement…

Q: Question 13 If the U.S. dollar appreciates, then U.S. exports O a) increase and U.S. imports…

A: Exchange rate basically refers to the rate of exchange at which the currency of one nation can be…

Q: For an imaginary economy, the value of the consumer price index was 138.57 in 2017, and the…

A: Consumer price index (CPI) is the measure of overall cost of buying market basket by a consumer.…

Q: Please refer to the figure below. The equation for p = 105-0.00 25,000+65L Y D (units sold)…

A: Given information: P = 105 - 0.005DTC = 25000 + 65D

Q: How can extensive government intervention influence health economics

A: Health economics is the study of economics that deals with concerns of the supply of health care in…

Q: Using general equilibrium analysis, and taking into account feedback effects, analyze the following:…

A: The outbreaks of diseases affect the supply of chicken and beef on the chicken farms. As the result,…

Q: *7. Leon is a rock climbing enthusiast, and is considering getting a membership at a new rock…

A: Total cost is the sum of fixed and variable costs. Marginal cost is the change in total cost from…

Q: the marginal cost of production for laplops and printers is zero. arge only individual prices (not…

A: Question solved below,

Q: does a gap between the average earning of between of men and women, or between whites and black,…

A: Introduction Discrimination is defined as behaviour based on the conviction that members of a…

Q: Describe the current merger trends and how they affect the businesses involved and their…

A: Merger is defined as the process through which one business organization's corporate unit,…

Q: 1. Money has several functions. Enumerate and discuss each function in your own words 2. On the…

A: "Since you have asked multiple questions ,we will solve first question for you.If you want specific…

Q: Problem 17.051: Calculate the after-tax PW of two alternatives Perform a present worth (PW)-based…

A: Present-worth (PW) based evaluation is one of the ways for evaluating a group of options using…

Q: As an owner of a small business, you want to determine the optimal monthly advertising expenditures…

A: In a perfectly competitive market, the optimal, profit-maximising level of output is decided by the…

Q: The game of rock-paper-scissors is played as a zero-sum gambling game so that the loser of each…

A: Given information Modified zero sum Rock, Paper and scissor game Looser pays $1 to winner When…

Q: Would increasing the minimum wage force business's to lay off workers and result in higher…

A: Minimum wage act: - it ensures the minimum amount of wage for workers. Unemployment: - unemployment…

Q: Why do people migrate?

A: Migration is defined as movement of people from one place to another for settling temporary or…

Q: MAKE SURE TO DEFINE THESE WORDS AND EXPLAIN IT VERY WELL. -Economic Globalization -Cultural…

A: International economics deals with the effects of economic activity which results from International…

Q: Compared to a corporation, a partnership is more difficult and expensive to establish.; True or…

A: Meaning of Financial Assets: The term financial assets refer to the situation, under which these…

Q: Compared to China, the US has a higher growth rate of output per capita Higher worker productivity a…

A: The correct option is all of the above. Compared to China, the US has higher growth rate of output…

Q: QUESTION 3 Use the figure below to answer the following questions: Price and cost (dollars per tonne…

A: The graph shows that there is the presence of negative externality. There will be over production of…

Q: 1. What is the equation Y= C (Y-T) + I (Y, r+x ) + G telling you about the determination of…

A: Answer -

Q: one idea of how important ethics are in the business industry.

A: Almost every corporation now has an ethics code. Technological advancements and digital…

Q: 8

A: Investment banks are the banks that help startup companies to launch. It acts as an intermediary…

Q: This payoff matrix represents the choices of two large universities in the Dallas area. The numbers…

A: Payoff matrix is a table that gives the playoffs from all the strategies open to an organization and…

Q: Assume that 1) households hold no currency and 2) banks hold no excess reserves. The current reserve…

A: Reserve requirement = 10% Money multiplier = 1/RR Money Multiplier = 1/0.1 = 10

Q: A A company needs special machine for checking the temperature of the production machines, the…

A: The information being given is as follows:- N = 40 F = 3000 P = -11,000 I = 3%

Q: suggest ways on how you can contribute to reduce the effect of inflation

A: The economies, and the nations around the globe are involved in various financial, and economic…

Q: When money serves as a mechanism for transforming current income into future purchases, it is…

A: Money is a financial asset which is used to buy goods and services

Q: If the appropriate discount rate for this project is 14%, then the net present value (NPV) is…

A: Given interest rate = 14% Present value of each cash flow = cashflow /(1 + rate)^time For year 0 =…

Q: 4) Mitsven Surfboard Inc. is a company in San Diego that shapes and sells surfboards. In 2018 their…

A: We will answer the first question since the exact one was not specified. Please submit a new…

Q: Demand pull inflation and cost push inflation are the two causes of inflation. The government of…

Q: Cisco, Inc. has a proposal from the Engineering Planning Division to invest some of the Cisco…

A: The yearly cost of owning, operating, and maintaining an asset throughout its full life cycle is…

Q: How is mortality measured?

A: It is difficult to measure mortality due to language difference, health infrastructure issues,…

Q: For each price in the following table, calculate the firm's optimal quantity of units to produce,…

A: A competitive market is one in which numerous producers compete for the goods and services that we,…

Q: Currency $150 billion Bank reserves $400 billion Checkable deposits $1,200 billion Time deposits…

A: Given; Currency= $150 billion Bank reserves= $400 billion Checkable deposits= $1200 billion Time…

Q: Suppose there are two consumers in the market for a good, consumer 1's inverse demand function is…

A: Consumer 1's inverse demand function: p = 80-2q1 Consumer 1's demand function: 2q1 = 80-p q1 = 80-p2…

Q: area, for a total of 12 pollution units. If the government wants to reduce total pollution in the…

A: given that, the cost of eliminating the pollution by 3 units of pollution in dollars

Question

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1- Introduction

VIEW

Step 2- Explanation

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

what is the equilibrium income in this IS-LM model? Y = C +I +GC = 200+0.8(Y-T )I = 1,600-100ｒ G =T = 1,000MS= 5,000 P =2MD/P= 0.5Y - 250ｒ +500 ➀ 5000 ➁ 6000 ➂ 7000 ➃ 8000 ➄ 10000 Please type out the correct answer ASAP within 40 min with proper explanation of the each option given. Will give you thumbs up only for the correct answer.
The Based on the following equations Saving (S)= 0.2Y Investment(1)= - 30r + 740, Money Supply(Ms)= 4000 Transaction Demand for Money(L 1) = 0.15Y Speculative demand for money (L2) =-20r+3825. The simple investment multiplier is
If a lump-sum income tax of $35 billion is levied and the MPS is 0.2, the consumption schedule will shift Multiple Choice downward by $28 billion. upward by $28 billion. downward by $35 billion. downward by $7 billion.
The equilibrium interest rate:Select one:a. both has an inverse relationship with money supply and affects both the size of totaloutput and its compositionb. determines the composition of spending but not its total amount.c. affects both the size of total output and its composition.d. has an inverse relationship with money supply.e. falls when the demand for loanable funds increases.
Show graphically how the capital stock will respond to(i) a permanent increase in output price;(ii) a temporary investment tax credit scheme that rebates a fraction r of the value ofinvestment.
Desired consumption is Cd = 100 + 0.8Y - 500r - 0.5G, and desired investment is I d = 100 - 500r. Real money demand is Md/P = Y - 2000i. Other variables are: expected inflation = 0.05, G = 200, y
Compare the impact of a recession that reduces consumer income by 10 percent on the consumption of durable goods and house rentals. Suppose that the income elasticity of demand for durable goods is 1.5 and the income elasticity of demand for house rentals is 0.3. Based on your response, make a policy argument to support through government funding either businesses or house rentals.
Assume the following: Spot USDBRL = 5.0500 1YR USD Money Market Rates = 1.50% 1YR BRL Money Market Rates = 9.00% What is the 6MO USDBRL forward rate? (Recall that Money Market Rates are quoted as annualized rates)
Desired consumption is Cd = 2000 + 0.9Y - 100,000r - G, and desired investment is I d = 1000 - 45,000r. Real money demand is Md/P =Y - 6000i. Other variables are πe = 0.03, G = 500, Y = 1000, and M = 2100. Required (a) What feature in this example leads to the result that you don’t need to know the amount of taxes collected by the government to find the equilibrium?
Inflation in the Philippines this year has surged to 4.9% in 2022, exceeding the inflationtarget band set by the Bangko Sentral ng Pilipinas. In response, the BSP might raise theirkey real interest rate soon, which will in turn affect loaning and lending rates in thecountry. In response to these conditions, firms and investors are growing anxious and assuch, are planning on pulling back on their investments. Given all the information above, illustrate and explain the effects of the decrease ininvestment on the economy. Make sure to cover the following: shifts (if any) in theaggregate expenditure curve, the change in equilibrium output (i.e. identify and comparethe old and new level of equilibrium output in the graph, and the multiplier effect.
Consider the following 2-period model U(C1,C2) = min{3C1,4C2} C1 + S = Y1 – T1 C2 = Y2 – T2 + (1+r)S Where C1 : first period consumption C2 : second period consumption S : first period saving Y1 = 20 : first period income T1 = 5 : first period lump-sum tax Y2 = 50 : second period income T2 = 10 : second period lump-sum tax r = 0.05 : real interest rate Find the optimal saving, S*
19. Gross investment is the total amount spent on purchases of new capital and on replacing depreciated capital. True or false 21. Fiscal policy has important effects on the level of employment, nominal GDP and on aggregate supply, known as secondary supply effects. True or false 23. An increase in government spending is an expansionary fiscal policy. True or false