e. Electric power providers become more confident in the ability for wind farms to meet electricity demand. This leads to a boom in building and producing wind farms across the country. IS-MP graph Real interest rate (%) Output gap (%) IS curve MP curve
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- Suppose Ford Motor Company issues a five year bond with a face value of 5,000 that pays an annual coupon payment of $150. What is the interest rate Ford is paying on the borrowed funds? Suppose the market interest rate rises from 3 to 4 a year after Ford issues the bonds. Will the value of the bond increase or decrease?Investors sometimes fear that a high-risk investment is especially likely to have low returns. Is this fear true? Does a high risk mean the return must be low?Interest 6% lonable fund is 4trillion. Suppose there was a change in the tax laws to encourage savers to save more and as a result, assume the equilibrium interest rate falls by 2 % point. By how much the equilibrium loanable funds saved and invested would rise or fall?
- . Assume you just deposited $1,000 into a bank account. The current real interest rate is 2%, and infla- tion is expected to be 6% over the next year. What nominal rate would you require from the bank over the next year? How much money will you have at the end of one year? If you are saving to buy a fancy bicycle that currently sells for $1,050, will you have enough to buy it?Deflation refers to the increase in purchasing power, while Inflation refers to the decrease in the purchasing power Select one: O True O False Next page R3- RATIO ANALYSIS (1) Jump to... CHAPTER 5- STOCK VALUATION- Al Hamooda (Log out) ENG 07 11 4407/0 INITA firm with 100 workers produces 1000 units a month with fixed capital depreciation costs of $90,500, raw materials $199,000, auxiliary materials $10,000, and unit cost of wages 10usd/ 1 product. m'=250% a. Calculating value: constant capital, variable capital, fixed capital, mobile capital b. Calculate the average salary of 1 worker c. Calculate the total value of products of the business and the value of 1 product unit
- Assume there are only two producing sector Y & Z in an economy. Calculatea) Gross value added at market price by each sector b) National income from the followings:Items Amount in CroresNet factor income from abroad- 20Sales by Y= 1000Sales by Z= 2000Change in stock of Z= -200C Closingstock of Y= 50 Opening stock of Y= 100Consumption of fixed capital by Y & Z= 180Indirect taxes paid by Y & Z= 120Purchase of raw material by Y= 500Purchase of raw material by Z= 600Exports by Z= 7010:42 İQIY we.l il, 63% iז Vo) LTE2 Discussions Difference between nominal and effective rates of interest ? What is the difference between Nominal Rate and Effective Rate of Interest? Is 10% per year compounded quarterly a nominal rate of interest? Reply Replies are only visible to those who have posted at least one reply. Module 4 - Nominal and Effective Interest Rates1. Hula hoop fabrications cost $100 each. The H2H company is trying to decide how many of these machines to buy. The number of hoops for each year and for each level of capital stock shown as follows: Number of fabrications Number of Hoops produce per year 1 100 2 150 3 180 4 195 205 210 Hula Hoop have a real value of $1 each. There is no other costs besides the cost of fabricators. a) Find the expected future marginal product of capital (in terms of dollar) for each level of capital. b) If the real interest rate is 12% per year, and the depreciation rate of capital is 20% per year, find the user cost of capital (in dollar per fabricator per year). How many fabricators should H2H buy? c) Repeat part (b) for a real interest rate of 8% per year? d) Repeat part (b) for a 40% tax on H2H's sales revenues. e) A new innovation doubles the number of hoops fabricator can produce. How many fabricators should H2H buy when the real interest rate is 12% per year? 8% per year? Assume that there are…
- Chapter 2 Assignment Long-Term Interest Rate 10 9 8 7 3 2 1 0 D Amount of Funds Ⓒ Without influence from foreign sources of funds, the long-term equilibrium interest rate is term equilibrium interest rate is %. %. With influence from foreign funds, the long- The following graph depicts the market for business investments in the United States. The green line represents the relationship between the long-J Assume that at the beginning of the year, you purchase an investment for $14,200 that pays $95 annual income. Also assume the investment's value has increased to $15,800 by the end of the year. a. What is the rate of return for this investment? Note: Input the amount as a positive value. Enter your answer as a percent rounded to 2 decimal places. Rate of return b. Is the rate of return a positive or a negative number? O Positive O NegativeG. No.1-(@) Whet type of diagram is suitable to present following infoumation University? Gine feason and about s'tudercts passed from a plot it. year NO Studet 140D 1600 1700 2006 2007 2008 O A persen in vzst B 200000 at 62, Rs Soc0at 7% ancl Rs aso00 at 8%. What is the avesage retusn on investment ?