Use the following statements to answer this question: I. Higher government deficits increase the supply of bonds and shift the supply curve to the right. II. Increase in expected inflation shifts the supply curve to the right and the cost of borrowing increases. O A Iis corect, Il is incorrect OB I and Il are correct O C. Iis incorrect, Il is correct OD I and Il are incorrect
Q: Firms that can effectively price discriminate can increase profitability when they engage in predato...
A: Varying audiences pay different prices for the same goods, which is known as price discrimination. T...
Q: Consider the compound interest equation B(t) = 100(1.1664)'. Assume that n = 2, and rewrite B(t) in ...
A: Answer -
Q: In the Heckscher-Ohlin model, modelling supply chains A is impossible. B can invalidate the ...
A: H-O Model of free trade states that as countries advance toward free trade, the prices of the output...
Q: Is it worth investing in a project that costs up to 600 million dollars across 11 years but is expec...
A: Discount rate refers to the rate or interest rate by which future values are discounted such that th...
Q: To assume that the structural model of an economy is given below : C = 100+0.75 Ya %D | = 200 %3D G ...
A:
Q: An optional question to give you more practice solving games. Consider the following one-shot simult...
A:
Q: Consider an economy with only two goods: bread and wine. In 1982, the typical family bought 4 loaves...
A: Consumer price index (CPI) is used to estimate the average variation between two given periods in th...
Q: The first cost of a certain equipment is P324,000 and a salvage value of P50,000 at the end of its l...
A: First, we convert all values into an equivalent A i.e. annual equivalent value. Then, to find the ca...
Q: Suppose the local authorities wanted to achieve a more drastic reduction in total pollu- tion of 75 ...
A: Let us assume , Marginal abatement cost of firm 1 be = c1 Marginal abatement cost of firm 1 be = c...
Q: 11. A tariff on imports benefits domestic producers of the imported good because A. They get the tar...
A: Economic externalities are the extra costs or benefits that occur to a third party that is not a par...
Q: Suppose the local authorities wanted to achieve a more drastic reduction in total pollu- tion of 75 ...
A: Let us assume , Marginal abatement cost of firm 1 be = c1 Marginal abatement cost of firm 1 be = c...
Q: Ray is an employee at COB company who likes having burger (x) and Pepsi (y) during the break and the...
A: Introduction Ray is in the employee of COB company which likes to having burger (x) and Pepsi (y) du...
Q: An economy is described using the following equations: C- 300 + 0.75(Y - T) |= 120 G=90 NX --100 T-1...
A: Planned aggregate expenditure (AEp) is the sum of consumption (C), investment (I), government spendi...
Q: required in order for a company's project to be successful (for example, each player could be a diff...
A: In the above sequential game let us use backward induction method to get some idea about the game an...
Q: %3D 0- 1 e optimal mixed row strategy. e optimal mixed column strategy.
A: All A,B, & C part solved below,
Q: In general, different jobs pay different wages. One overarching reason is that different jobs have d...
A: Answer -1 Compensation salary refers to the additional pay given to an employee in exchange for par...
Q: A number of particular articles has been classified according to their weights. After drying for two...
A:
Q: Suppose there are two power plants that release sulfur dioxide (SO2) into air at their current produ...
A: Introduction Two Power plant has given as MAC1 = 3q1 + 5 MAC2 = 2q2 They both release 150 units of S...
Q: draw James leisure demand curve. Which effect, substitution or income, is larger for him? James' lei...
A: James James Xiao Xiao price of og wage leisure other goods leisure other good...
Q: 4. Consider an individual who lives for 2 periods and each period receives a constant income of $y p...
A: Given information U(X0,X1)=X02+βX12Income in each periodY1 and Y2interest rate=r
Q: How has the global economy changed?
A: A global economy is the result of economic interdependence between the world's most powerful countri...
Q: Please calculate CPI and inflation using the following basket of goods (round outlays (for calculati...
A: Here, the information about the quantity of different goods and their prices are given for year 2021...
Q: It costs 100, 000 pesos at the end of each year to maintain a certain portion of a highway. If money...
A: Given: The cost of maintaining a certain portion of a highway is = 100,000 pesos The money is worth ...
Q: What do you think is the significance of concept on foreign reciprocity?
A: International trade is a very important concept of economics which forms a very important part of th...
Q: 5.6 5.2 4.8 4.4 4.0 3.6 3.2 2.8 2.4 2.0 1.6 1.2 0.8 0.4 0.4 0.2 1.2 Peaches (millions of tons) a. At...
A: From the given production possibility frontier of Itlay and Turkey, the production schedule is as fo...
Q: Amadea spends all her income on pizza, chocolate milk, and music streams. The price of pizza is $4 p...
A: Answer: Given, Price of pizza PP=$4 per slicePrice of chocolate milk PCM=$2 per bottlePrice of music...
Q: In Ergonia, 4 million workers produce a real output of $520 billion in 2018 and the same number of w...
A: Labor productivity refers to the output produced by per unit of labour. It is also known as Average ...
Q: For each of the following production functions Q = f(K,L), find the marginal productivity with respe...
A: The marginal product is calculated by differentiating the production function with respect to partic...
Q: optimal quantity of public goods that the government should provide, and interpret your results. Mak...
A: The correct answer is given in the second step.
Q: In each of the following cases, calculate the values of MPC, MPW, and the spending multiplier. Enter...
A: Spending multiplier: - it is a fraction that shows the magnitude of the change in national income du...
Q: If it is not profitable for more than a single firm to be in an industry, we have an example of Sele...
A: A monopoly is a single seller selling unique good in the market.
Q: If price is increased from $3 to $4 in the graph above, consumer surplus will fall by:
A:
Q: Analyse the Situational environments with example organization. (E.g. External such as PESTEL, Porte...
A: PESTLE are the tools that would make the company understand the competitive positions in the markets...
Q: Disadvantages of a mixed economy
A: Mixed economy: The economy in which some parts are controlled by the private sector and some by the ...
Q: 2. In contrast to strawberries, Canada is a major exporter of wheat. Canada's demand (QPCDN) and sup...
A: Note:- Since we can only answer up to three subparts, we'll answer first three. Please repost the qu...
Q: Research about unethical business practices
A: Maintaining a successful business will be a battle every day, even if you have the best idea and the...
Q: Find the present value of an annuity of $2,000 payable at the end of each year for 10 years, if the ...
A: Answer is given:
Q: C D Quantity Refer to the graph shown. Between points C and D, marginal utility is: Marginal Utility
A: Total utility is the total amount of satisfaction that a consumer derives from the consumption of sp...
Q: 8:55 PM Assignment Print View c. When the total money supply decreases, there will be an adjustment ...
A: Sff1 - New supply of federal fund. Sff - supply of federal fund
Q: Profit-maximizing monopolies are inefficient because Select one: O a. they practice price discrimina...
A: Monopolistic competition is a market system in which many businesses exist in the same industry and ...
Q: 10 Supply 7.5 2.5 Demand 200 400 600 800 Q When the market in the graph above is in equilibrium, con...
A: Consumer surplus shows the difference between consumer willingness to pay and the actual price paid ...
Q: Consider the same marginal revenue functions. Suppose now that teams must share 40% of their revenue...
A: The marginal revenue function is the subordinate of the all out revenue function r(x). here given t...
Q: Suppose that you're working to calculate a monopolist's profit-maximizing uniform price in a market ...
A: We will answer the first question since the exact one was not specified. Please submit a new questio...
Q: If you deposit $10000 into a fund paying 6% interest. how much will be the amount after 1 years.
A: Deposit amount = $10000 Interest rate = 6% Time = 1 year
Q: The table below shows money demand and supply schedules for a hypothetical economy, Argentia. Nomina...
A: Answer: Since we only answer up to 3 sub-parts, we’ll answer the first 3. Please resubmit the questi...
Q: Q Suppose that the market is initially at an equilibrium price of $6 and an equilibrium quantity of ...
A: We show that deadweight loss from the tax given below
Q: Suppose country A has five families. Their incomes are $10,000, $20,000, $30,000, $40,000, and $50,0...
A: Given: The number of families is = 5 Income of the families are $10,000, $20,000, $30,000, $40,000, ...
Q: If a bank has $100,000 in deposits and holds $5,000 in required reserves, what is the value of the m...
A: Money multiplier: - it is the ratio that shows the maximum amount of money that can be created with ...
Q: The following table shows Farmer Parker's revenue, cost, and profit from wheat farming Quantity (bus...
A: Total cost is a sum of fixed cost and variable cost. Fixed cost remains constant and does not depend...
Q: Given the following technology matrix for a two sector economy: 0.4 01 A = 0.7 0.6 The final demand ...
A: Answer is given in the picture:
Step by step
Solved in 2 steps
- a). Under what condition do we say a financial market is efficient? Distinguish between weak and semi-strong form efficiency. b). Explain any five (5) ways a company can raise equity capital in the financial market. c). One of the ways in which the government can finance its fiscal deficit is to borrow funds through the domestic loanable fund market. Explain how this deficit financing strategy of the government can crowd out the domestic private sector and increase interest rate.From the end of 2009 to the end of 2019, the size of the United States National Debt held by the public grew from $6.8 trillion to $17.2 trillion. During the same period, the 10 year US Treasury Bond yield to maturity fell from 3.59% in December 2009 to 1.86% in December of 2019. Explain how such an increase in the supply of government bonds can lead to a fall in the interest rate. Second, consider that the 10 year bond rate has fallen further in 2020 to 0.68 percent on October 1, despite a further increase in the national debt ($20.5 trillion as of June 30, 2020) due to the decline in the economy and increase in federal government spending. Why has this continued in 2020 during an economic crisis?Use the model of supply and demand for bonds to illustrate and explain the impact of each of the following on ( a ) equilibrium quantity of bonds ( b ) equilibrium prices and ( c ) yields . Make sure you support your answer by explaining " why " those effects occur . Be as specific as you can be . . A)Inflationary expectations in the economy fall which results in a much stronger response from bond issuers than investors B)Data shows that the real estate market is going to weaken
- A- Suppose potential GDP is $20 trillion. If the economy produces at potential, then the government budget deficit is $1 trillion. If actual GDP is $19 trillion, the government deficit is $1.25 trillion. The cyclically adjusted budget deficit is ___ trillion (do not enter a ‘$’ sign Assume an interest rate of 5%. What is the maximum amount an individual would be willing to give up today in exchange for $1, paid 30 years in the future? Suppose the government has promised to pay $100 billion dollars in benefits 10 years from now. Assuming an interest rate of 4%, what is the present discounted value (PDV) of the obligation? Answer in billions of dollars, rounded to two decimal places.Question:- How would each of the following events to affect the level of interest rates? Sketch demand and supply diagrams of the market for lending and borrowing to illustrate your answers. Also, for each answer say whether crowding out is likely to be a problem. 1. the budget surplus increases 2. the budget deficit increases and contractionary monetary policy is implemented 3. the budget deficit increases and expansionary monetary policy is implementedF2 2. Use diagrams to show Ricardian Equivalence and the Impact of a Budget Surplus on Credit Markets. (Two altogether separate diagrams.) Label and draw changes carefully. Explain in a sentence or two the thrust of each concept (i.e., what happens or changes).
- Suppose the government borrows $20 billion more next year than this year. a. Use a supply-and-demand diagram to analyze this policy. Does the interest rate rise or fall? b. What happens to investments?To private savings?To public savings?To national savings? Compare the size of the changes to the $20 billion of extra government borrowing. c.How does the elasticity of supply of loanable funds affect the size of these changes? d. How does the elasticity of demand of loanable funds affect the size of these changes?Let: C = consumption I = investment spending G = government spending Tx = tax revenue Yd= after-tax income MS = money supply MD = money demand r = interest rateAssume for a given closed economy:(i) Consumers spend $200 billion plus 80% of after-tax income, orC=200+0.8 Yd(ii) Investment demand varies inversely with the interest rate, such thatI= 500-2000r(iii) Currently government spending and taxes are both $250 billion, orG=250 and Tx=250,(iv) The total money demand or liquidity preference schedule for this economy is an inversefunction of the rate of interest and is given by the equationMD=850-1000r(v) The required reserve ratio for banks in this economy is 20%. No bank holds excessreserves, and everybody keeps their money in the bank. The total of reserves in the banks is$150 billion.Answer the following questions given the information above.d) The central bank wants national income to be $3000 billion. What must investment befor the equilibrium level of national income to be $3000…The formula for the deficit in the pension fund of a large company is given by y (in millions of dollars) for year x (where x = 0 is Jan. 1, 2000). The formula for y is y = -0.2x3 + 1.8x2 + 2.5x + 75 Consider the years Jan 1, 2000 to Jan 1, 2015 (x=0 to x =15). c) Fill in the blanks! The largest deficit is _____________ in the year ___________ The smallest deficit is ________________ in the year _______________
- The current market rate of interest is 10 percent. At that rate of interest, businesses borrow $300 billion per year for investment and consumers borrow $50 billion per year to finance purchases. The government is currently borrowing $150 billion per year to cover its budget deficit. a. Derive the market demand for loanable funds, and show how investors and consumerswill be affected if the budget deficit increases to $250 billion per year. Draw a graphto show your conclusion. b. Assuming taxpayers do not anticipate an increase in the future market rate of interestdue to the increase in budget deficit, show the impact of the increase in the budgetdeficit on the market for loanable funds. c. How would your conclusion differ if taxpayers fully anticipate future tax increases tooffset the increase in the budget deficit? d. Do you think the Ricardian Equivalence is realistic?The current market rate of interest is 10 percent. At that rate of interest, businesses borrow $300 billion per year for investment and consumers borrow $50 billion per year to finance purchases. The government is currently borrowing $150 billion per year to cover its budget deficit. a. Derive the market demand for loanable funds, and show how investors and consumerswill be affected if the budget deficit increases to $250 billion per year. Draw a graphto show your conclusion. b. Assuming taxpayers do not anticipate an increase in the future market rate of interestdue to the increase in budget deficit, show the impact of the increase in the budget deficit on the market for loanable funds. c. How would your conclusion differ if taxpayers fully anticipate future tax increases to offset the increase in the budget deficit? d. Do you think the Ricardian Equivalence is realistic?43)Which one of the following statements is TRUE? Select one: a.“Cowding out” occurs because the Fed increases money supply and lowers interest rate b.“Crowding out” occurs because the Govt increases govt expenditures and this causes private consumption and investment to increase c.Crowding out” occurs because the Govt decreases govt expenditures and this causes private consumption and investment to decrease d.“Crowding out” occurs because the Govt increases govt expenditures and this causes private consumption and investment to decrease