what is high interest rates?

Q: rates affect business? Consumers?

A: Market interest rate plays extremely essential part in the business and customer spending in light…

Q: Is everybody worse off when interest rates rise?

A: The interest rate is the rate charged by the lender on the asset lend by them. The asset lend can be…

Q: Discuss briefly how do interest rates affect the economy?

A: The amount of interest due per year, expressed as a percentage of the amount lent, invested, or…

Q: If government spending were increased, what would occur to interest rates

A: Government spending refers to the money spent by the government on things like health care,…

Q: What is current yield?

A: Investments in the economy are important for the development, progress, and growth of economies…

Q: Would a dollar tomorrow be worth more to you today when the interest rate is 20% or 10%?

A: Given the interest rates are 20% and 10%.

Q: What is the difference between Market and Inflation-Free Interest Rates?

A: Market and inflation free interest rate are entirely different concepts. Market is the place that…

Q: Describe how interest could be  good or bad, depending on the situation, and explain why interest…

A: If properly managed, a LOW INTEREST RATE can be beneficial. Low interest rates reduce demand for the…

Q: Explain why negative real interest rates cannot exist in an economy that is properly functioning

A: When interest is given to borrowers rather than lenders, it is referred to as having a negative…

Q: Real interest rates can be negative.  True  False

A: The real interest rate is the inflation adjusted interest rate. That is, inflation implies that real…

Q: Which situation leads to the distinction between nominal and effective interest?

A: If the compounding is more frequent than once per year, then the nominal and effective interest rate…

Q: Would it be advantageous to borrow money if you expected prices to rise?  Would you want a…

A: Inflation is change in the overall price level of the economy. Generally, interest rates for loans,…

Q: If the interest rate is 8%, how much households and firms will want to borrow?

A: The households and firms that want to borrow imply the demand for funds in the market. Thus we will…

Q: The cost of money is established and measured by an interest rate. True or false?

A: Answer - Cost of Money -  Cost of the money is amount of interest can be charged on the money…

Q: would bonds still be a good option for investment if interest rates are negative?

A: Negative-yielding bonds are monetary instruments that cause buyers to lose cash.  They are typically…

Q: Write the two types of interest rates used in equivalence calculation rates?

A: The amount of interest received for an investment at the end of a year need to calculate its…

Q: pose that interest'rates fall. This will cause:

A: If interest rates falls then cost of borrowing money from the money market decreases.  Investors…

Q: What are Nominal Interest Rates?

A: Inflation refers to a continuous increase in the price of any commodity and service in the economy…

Q: complete this sentence: High interest rates might might purchasing a house, but at the same time…

A: High interest effects both the borrower and lender in the different manner As interest rate…

Q: If you hold a bond at a time when the market interest rate is increasing, you will find that the…

A: Interest Rate Risk: The phenomenon of an inverse relationship between market interest rates and bond…

Q: What is a balance sheet? What is net worth?

A: Balance sheet and net worth are part of financial analysis and accounting.

Q: What are the applications of partial derivatives in economics?

A: The derivative of a function of a single variable that depicts quickness of change in function value…

Q: When is the simple interest scheme used?

A: Simple interest is a method which is used to calculate interest charged on fixed deposit, loan and…

Q: What is the financial market, what does it do in terms of saving investment and interest rates

A: A market is a place where the exchange of goods and services takes place between the consumers and…

Q: Explain time and interest rate effect on future value?

A: Interest rate: It is the rate of earning in a specific time period on the investment.

Q: What might cause interest rates to be low one year and high the next?

A: Interest rates are best thought of as the "cost of money." If a borrower wishes to spend more money…

Q: How to analyze the rate of interest?

A: The interest rate is the percentage of the amount paid by the borrower to the lender in a given…

Q: How could people be persuaded to start saving for retirement?

A: Retirement planning is the process of putting money aside, investing it, and then distributing it in…

Q: What is meant by the neutrality of nominal interest rates?

A: In an economy, interest rate refers to the proportion of the actual money that an individual has to…

Q: What causes the yield on a discount bond to exceed the coupon rate on a bond?

A: The markets are the place where the buyers of the goods, services, and products tend to meet and…

Q: Do the financial institutions usually quote the interest rate on an annual basis?

A: The interest rate is a specific percentage of principal that must be paid by a borrower of money to…

Q: What is the discount bond?

A: A bond is a financial instrument that specifies the financial obligation of the bond issuer to the…

Q: The discount rate will never be equal to interest rate. True or False?

A: Discount rate is defined as the rate of interest which is charged to commercial banks and other…

Q: How can financial institutions overcome the inevitable mobility of students after graduation?

A: A financial institution is an organization that deals in several forms of monetary transactions,…

Q: You hold a two-period bond that pays a coupon  at the end of each period. The interest rate is…

A: Holding a two-period bond, that pays a coupon at the end of each period with an interest rate of…

Q: How is an Effective Interest Rate calculated?

A: The effective rate of interest is an important concept in economics.  The effective rate of interest…

Q: Causes and effects of low interest rates

A: The interest rate is determined by the intersection of demand and supply of loanable funds. It is…

Q: The price of a bond is.

A: Bond price is the present discounted value of future cash stream generated by a bond.

Q: When the interest rate rises, bond values

A: GIVEN   the interest rate raise,bond values is

Q: What is the relationship between nominal and effective interest rates?

A: The interest rates refer to the rate at which the loans are given by the banks, or other lending…

Q: What is meant by Prime interest rate?

A: Prime Interest Rate is the interest rate which is determined by the federal funds rate.