Refer to the diagrams. Other things equal, an interest rate increase will: Question 15 options: leave curve A in place butshift curve B downward. leave curve A in place but shift curve B upward. shift curve A to the left and shift curve Bdownward. shift curve A to the right and shift curve B upwardExpanded Rate of Return, r,and Real Interest Rate, I (%)Investment ($B)Investment ($B)AReal Domestic Product,GDP ($B)B

If the interest rate increases, the investment will decrease. When interest rates rise, the cost of…

Answered: Refer to the diagrams. Other things…

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter16: The Markets For Labor, Capital, And Land

Section: Chapter Questions

Problem 12P

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A consumer's current income (y) is 200 and the future income ( t.') is 240. A current lump sum tax (t) of 10 is paid and the tax in the next period (t) is 15. The real interest rate is 20% for each period. Please assume that current and future consumption are complements. and the consumer always prefers to have one unit of current consumption and two units of consumption in the future. Calculate the optimal current and future consumption and the optimal current and future savings. Is the consumer a lender or a borrower? How does he she. as a lender or a borrower. affect the future consumption?
A consumer's current income (y) is 200 and the future income ( t.') is 240. A current lump sum tax (t) of 10 is paid and the tax in the next period (t') is 15. The real interest rate is 20% for each period. Please assume that current and future consumption are complements. and the consumer always prefers to have one unit of current consumption and two units of consumption in the future.Calculate the consumer's lifetime wealth.Calculate the optimal current and future consumption and the optimal current and future savings. Is the consumer a lender or a borrower? How does he she. as a lender or a borrower. affect the future consumption?
Q.3.4 Year (Base year) 2018 2019 2020 2021 Cost of a basket (R) of consumer goods/services Explain, with the aid of an equation, the components of the consumption function. 1850 2190 2380 2560
SIMPLE INTEREST
The table contains data on the relationship between saving and income. Rearrange these data into a meaningful order and graph them on the accompanying grid. What is the slope of the line? The vertical intercept? Write the equation that represents this line. What would you predict saving to be at the $12,500 level of income?
a, b and c
Assume Medet decided to buy a car. His friend Aidar has lent him $10,000 USD. Medet and Aidar agree that Aidar should earn a real return of $5 percent per year. Enter your responses rounded to two decimal places. (a). The CPI (times 100) is 100 at the time that Frank makes the loan. It is expected to be $111 in one year and $128 in two years. What nominal rate of interest should Aidar charge Medet? The nominal rate of interest charged should be % in year 1. The nominal rate of interest charged should be % in year 2. (b). Suppose Aidar and Medet are unsure about what the CPI will be in one year. How should Aidar and Medet's annual repayments ensure that he gets an annual $5 percent rate of return? Aidar should charge Medet % more than the inflation rate.
What would be the value of consumption of Saving is $1300 and the income is $2250
point(s) possible The table has data from the nation of Atlantica. Disposable income (trillions of 2012 dollars) Consumption expenditure (trillions of 2012 dollars) 0.0 1.5 2.0 3.0 4.0 4.5 6.0 6.0 8.0 7.5 Based on these data, when disposable income equals $8.0 trillion, there is O A. saving of $0.5 trillion. B. dissaving of $15.5 trillion. O C. dissaving of $7.5 trillion. O D. saving of $15.5 trillion. O E. dissaving of $0.5 trillion.
(e) $1,250 per week $1,100 per month $3,000 per year Income from wages: Rental income: Income from investments: $58 per month National Insurance contributions: $129 per month Group Medical Insurance premium: Contribution to private pension fund $60 per month. Calculate: (i) the gross monthly income (ii) the disposable income per month (iii) the monthly savings if expenditure is $3,200 per month.
You buy a Treasury note for $960. Instructions: Round your answers to two decimal places. a. If you receive a payment of $40 every six months, then the annual rate of return is: b. If you receive a payment of $30 every six months, then the annual rate of return is: c. If you receive a payment of $45 every six months, then the annual rate of return is: %. %. %.
The effective interest rate can be calculated using the relationship between nominal rate and effective rate. Select one: O True O False

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