In the following table, determine how each event affects the position of the long-run aggregate supply (lras) curve. Right lefy right.
Aggregate supply or domestic final deliver is the total supply of products and services that firms in a country wide economic system plan on selling at some stage in a selected time period. it's far the entire quantity of goods and services that corporations are willing and capable of promote at a given rate level in an financial system.
Aggregate supply is the whole quantity of output firms will produce and promote—in other phrases, the real GDP. The upward-sloping combination deliver curve—additionally called the fast run combination deliver curve—suggests the high quality dating between rate level and real GDP inside the short run.
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james green just bought a stock which he expects will provide him with a quarterly cash payment, although that payment is not guaranteed. in fact, he expects the amount of the payment to vary over time. what type of payment is he expecting to receive?
James Green is expecting a payment in the form of a dividend.
Define Dividend.A dividend is the distribution of profits to shareholders by a corporation. When a corporation makes a profit or has a surplus, it has the option of paying a portion of that profit as a dividend to its shareholders. Any money that is left over is taken out and put back into the business.
A corporation distributes a percentage of its profits and retained earnings as a dividend to its shareholders. Retained earnings, which are accumulated when a corporation generates a profit, can either be reinvested in the business or paid out as a dividend to shareholders.
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based on an inventory count, the inventory is debited to merchandise inventory and credited to income summary. multiple choice question. average balance ending balance beginning balance need help? review these concept resources.
Based on an inventory count, the ending balance inventory is debited to Merchandise Inventory and credited to income summary.
What is ending balance inventory?Ending balance inventory can be defined as the amount of inventory that a company has in their warehouse at the end of their accounting period.
On the other hand beginning balance inventory is the reverse of ending balance inventory as it is the amount of inventory that a company has in their warehouse at the beginning of an accounting period.
On an inventory count of an organization , the ending balance inventory is debited to Merchandise Inventory account and as well credited to income summary account.
Therefore the correct option is B.
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Theo Chocolate has very public dedication to international fair trade, a dedication that comes before profits. Customers and employees who care about fair trade are more likely to support the cause with donations to Fair Trade USA. O more likely to shop for the best price or demand the highest salary. more likely to buy from or stay loyal to the firm
Theo Chocolate has very public dedication to international fair trade, a dedication that comes before profits. Customers and employees who care about fair trade are more likely to buy from or stay loyal to the firm.
With the help of fair pricing and the Fair Trade organization, fair trade helps farmers to improve their standard of living while contributing to broader societal change. Ecocert has granted Fair for Life certification to Theo Chocolate.
We focus on sourcing goods from smallholder farms and want to use organic and fair-trade products whenever feasible. With the intention of fostering prosperous, resilient communities, we work fairly with cocoa and ingredient-sourcing partners to provide them with decent wages.
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In a project monitoring system, data collected from ____ activity duration, resource usage, and costs are compared against ____ activity duration, resource usage, and costs.
In a project monitoring system, data collected from resources activity duration, resource usage, and costs are compared against project activity duration, resource usage, and costs.
In order to develop the project schedules, the scheduling process requires examining the activity sequences, activity resource estimations, and activity length estimates.The outcomes of the previous step are arranged to create the project's final schedule during the development schedule process. In this essay, the definition of the development schedule process and its goals are explored in great detail.Prior to creating the project schedule model, an analysis of activity sequences, durations, resource needs, and scheduling constraints is required.You will have a finalised project plan once the development schedule process is complete, which will include details like the beginning and ending dates of each project activity.
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Apocalyptica Corporation is expected to pay the following dividends over the next four years: $6.70, $17.70, $22.70, and $4.50. Afterward, the company pledges to maintain a constant 5.5 percent growth rate in dividends, forever.If the required return on the stock is 9 percent, what is the current share price? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
Current share price is $368.57
It is given that dividends over four years are 6.7,17.7,22.7,4.5
Growth rate = 5.5%
Required rate of return = 9%
The current share price (P₀) = D₁÷(k-g)
where,
D₁ = Expected dividend for the next years
k = required rate of return
g = growth rate
Thus,
current share price (P₀) = D₁÷(k-g)
D₁ = average of all the dividends of 4 years = (6.7+17.7+22.7+4.5)/4
=$12.9
current share price (P₀) = 12.9 / (9%-5.5%)
= 12.9 / 3.5%
= 12.9/0.035
= $368.57
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Suppose all banks are subject to a uniform reserve requirement of 20 percent and that the Gambler's Last Chance Bank of Las Vegas has zero excess reserves. If a new customer deposits $10,000, the bank can now extend new loans up to a maximum of _____.
The complete statement is "Suppose all banks are subject to a uniform reserve requirement of 20 percent and that the Gambler's Last Chance Bank of Las Vegas has zero excess reserves. If a new customer deposits $10,000, the bank can now extend new loans up to a maximum of $8,000. "Option B
What are loans?Generally, In the world of finance, the act of one or more individuals, organizations, or other entities lending money to other individuals, organizations, or other entities is known as a loan.
When someone receives a loan, they are typically responsible for repaying not only the initial amount borrowed but also the interest accrued on the loan up until the point at which the loan is paid off.
The full statement is as follows: "Imagine that all banks are required to maintain a reserve amount equal to 20 percent of their total assets, and that the Gambler's Last Chance Bank in Las Vegas has no reserves in excess of what is required. If a new customer deposits $10,000, the bank is now able to extend new loans up to a maximum of $8,000; however, the maximum loan amount remains unchanged." Alternative B
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CQ
Suppose all banks are subject to a uniform reserve requirement of 20 percent and that the Gamblers Last Chance Bank of Las Vegas has zero excess reserves. If a new customer deposits $10,000, the bank can now extend new loans up to a maximum of:
a.$2,000.
b.$8,000.
c.$10,000.
d.$50,000.
the equation of exchange part 2 a. states that the money supply times velocity equals nominal national income. b. is an accounting identity and is always correct. c. states that expenditures by some people equal income received by others. d. all of the above.
The equation of exchange is a states that the money supply times velocity equals nominal national income, an accounting identity and is always correct, and states that expenditures by some people equal income received by others.
The exchange equation is M V P Q. The velocity is the typical annual rate at which a dollar is spent to purchase final goods and services.
The monetarist theory is represented by the equation of exchange, MV = PQ. Here, M is the total amount of money available, and V denotes the velocity of money turnover or the frequency with which the average dollar in the money supply is spent on products on a yearly basis.
T stands for all the products and services exchanged. The exchange equation is an identity equation, meaning that MV is exactly equivalent to PT (or that MV = PT). The equation must always be accurate in the ex-post, or factual, sense.
Hence the correct option is D
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maxwell manufacturing issued $310,000, 9-year, 11% bonds at 105.25. what is the total amount of interest expense that will be recorded over the life of these bonds?
Maxwell Manufacturing will record the total amount of interest expense of $290,625 over the life of the bonds.
What is bond's interest expense?An interest expense in bond, means aggregate interest expense incurred during a reporting period for an organization's bonds payable.
Data available:
Bonds' Face Value = $310,000
Maturity period = 9 years
Coupon Interest Rate = 11%
Issuance rate = 105.25
Bonds Proceeds:
= $310,000 x 1.0525
= $326,275
Bonds Premium (to be amortized over 12 years):
= $326,275 - $310,000
= $16,275
Annual cash payments to bondholders:
= $310,000 * 11%
= $34,100
Total cash payments to bondholders:
= $34,100 * 9
= $306,900
Expense that will be recorded:
= $306,900 - $16,275
= $290,625
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amdd has 7 percent preferred stock outstanding that is currently selling for $49 a share. the market rate of return is 14 percent and the firm's tax rate is 37 percent. what is the firm's cost of preferred stock?
Amdd has 7 percent preferred stock outstanding that is currently selling for $49 a share. the market rate of return is 14 percent and the firm's tax rate is 37 percent. 14.29 percent is the firm's cost of preferred stock.
Preferential stock: What is it?One sort of stock that combines elements of bonds and equities is preferred stock. Preferred shares pay out cash dividends like bonds do, frequently at a greater yield than bonds while carrying less risk than regular stock and larger dividend returns.
How are preferred stocks traded?By paying dividends, preferred stocks provide a consistent flow of revenue. The dividend payments on preferred shares are fixed and typically range from 5 to 7 percent, and are typically greater than bond payments. They are furthermore paid out after bondholders get their payments but before dividends on common shares.
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what are three disadvantages of greenfield ventures? choose all that apply. multiple select question. uncertainty of future revenue considered first-movers preemption by other competitors take longer to establish loss of tax revenue
Potential drawbacks of greenfield projects include the following:
Potentially expensive to enter the market (barriers to entry)Having a greenfield location has significant fixed expenditures.What is a green-field venture?
In a green-field (also "greenfield") venture, a parent company creates a subsidiary in another country and launches its operations there from scratch. These projects also have additional offices, residential quarters, and distribution centers in addition to new production facilities. The phrase "green-field investment" refers to a venture that is being started from scratch by a company, typically a multinational corporation (MNC), after plowing and preparing a green field. The initiatives are foreign direct investments, also referred to as direct investments, which give the sponsoring corporation the most degree of influence.
The riskiest type of international direct investment is a greenfield project, which carries an exceptionally high level of risk.Regulations by the government that might prevent foreign direct investments.To know more about a green-field venture:
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laser corporation had $275,000 in invested assets, sales of $330,000, operating income amounting to $33,000, and a desired minimum return on investment of 7.5%. the return on investment (rounded to one decimal place) for blaser corporation is
By dividing operating revenue by invested assets, the rate of return on investment is calculated. Due to the fact that the operating income is $33,000 and invested assets total $275,000 Consequently, a 12% rate of return on investment is realized.
It establishes the quantity of investment return in relation to investment cost. It may be stated as a ratio or percentage. By dividing an investment's return by its cost, the return on investment is calculated.
The management is able to choose the most profitable investment option available to them thanks to the return on investment of various assets. To calculate the return on investment, use the data regarding operational income and invested assets.
Use the calculation below to get the rate of return on investment:
Rate of return = operating income / invested assets
= 33000 / 275000
= 12%
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you own 1,100 shares of stock in avondale corporation. you will receive a $2.60 per share dividend in one year. in two years, the company will pay a liquidating dividend of $48 per share. the required return on the company's stock is 20 percent. suppose you want only $800 total in dividends the first year. what will your homemade dividend be in two years? (do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.)
The homemade dividend in two years equals to $55,272.
How to calculate homemade dividend in two years?A dividends refers to the payments that a company makes to share profits with its stockholders. It is paid on a regular basis and are one of the ways investors earn a return from investing in stock
Data:
• Shares of stock= 1100
• yearly per share dividend = $2.60
• Liquidating dividend per share = $48
• Required return on stock = 20℅
• Dividend required by me = $800
Let's solve for the following:
Dividend received in one year:
= 1,100 * 2.60
= $2860
For price of stock in one year, we have:
= $48/1.20
= $40
The number of shares purchased:
= $2860 - $800 / $40
= $2060 / $40
= 51.50 shares
Dividend in two years will be:
= $48 * (1,100+51.50 shares)
= $48 * 1151.50
= $55,272
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how can a reduction in direct cost generate more of a price savings for a supply manager than a similar percentage reduction in the seller’s profit?
Everything is based off the cost of a product. A reduction in one cost of the product has a ripple effect lowering all the cost for the rest of the product and lowering the cost of the profit at the end. A reduction in the seller's profit just takes a small percentage off the top of the price.
Profit, in accounting, is an profits disbursed to the proprietor in a profitable marketplace production technique. income is a measure of profitability that's the owner's foremost interest inside the income-formation technique of marketplace production. There are numerous profit measures in common use.
Income describes the financial gain found out while sales generated from a enterprise pastime exceeds the charges, fees, and taxes worried in maintaining the pastime in question.
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a system that gathers comprehensive data, organizes it, and summarizes it in ways that are useful to managers for their nonroutine tasks is known as a(n) system.
A system that gathers comprehensive data, organizes it, and summarizes it in ways that are useful to managers for their non routine tasks is known as an operation information system.
It is safe to assume that the word being defined is an operational information system based on the information supplied in the question. In a nutshell, this is a system that a business uses to efficiently conduct all of its everyday business activities.
In order to provide the managers with the most complete data possible, the information is quickly collected, arranged, and summarized in an independent manner.
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A system that gathers comprehensive data, organizes it, and summarizes it in ways that are useful to managers for their non routine tasks is known as an operation information system.
They consider ongoing, daily operations as well as what must be done to fulfil urgent requests and short-term objectives. It is safe to assume that the word being defined is an operational information system based on the information supplied in the question. In a nutshell, this is a system that a business uses to efficiently conduct all of its everyday business activities. In order to provide the managers with the most complete data possible, the information is quickly collected, arranged, and summarized in an independent manner.
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the standard of living varies greatly among groups within a country as well as from nation to nation.
Yes, it is true that the standard of living varies greatly among groups within a country as well as from nation to nation.
The level of comforts, amenities, and services that are available to a society or location as a whole, as opposed to just one person, is referred to as the standard of living. The standard of living is significant because it is thought to affect a person's quality of life. The economy of the country is divided into different sections which produce different services. The value of the services is also different, which affects the money earned by the people of the country. As per the money earned by the people of the country, the country is divided into different classes based on earnings which create different standards of living in the country.
Apart from this, there was several economic and social dimension and disparities existing in the nation which gives more way to a different standard of living. All these together affect the standard of living of the people of the nation.
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according to the inventory control system matrix, independent demand with high transaction costs, it is likely to deploy what type inventory control process?
According to the inventory control system matrix, where the independent demand is with high transaction costs, it is likely to deploy a type inventory control process known as Manual two-bin.
What is a Manual two-bin in inventory control?In inventory control process, the two-bin control is a system used to determine when items or materials used in production should be replenished. When the items in the first bin have been depleted, an order is placed to refill or replace them. The second bin is therefore, supposed to have enough items to last until the order for the first bin arrives.
Therefore, the manual two-bin is the system that will be deployed where the independent demand is with high transaction cost.
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PLS HELP…… What is the difference between a charge card and a credit card?
O A charge card is paid off each month while a credit card has a revolving credit line.
O A charge card is issued by a bank while a credit card is issued by a merchant.
O A charge card has a revolving line of credit while a credit card is paid off each month.
O A charge card has zero interest while a credit card has a high interest
A charge card is paid off each month while a credit card has a revolving credit line is the difference between a charge card and a credit card. Thus, option (a) is correct.
What is credit card?A credit card is a payment card was the issued by the financial institutions. It was the provided of the customers to borrow funds, and the pre-approved credit limit. It was the provided the facilities such as purchases, balance transfers and the other things.
According to the main difference between the charge card is paid off each month. On the another hand was the credit card has a revolving credit line. It was the pay of the purchase of the goods and the services. It was the paid by the card issuer.
As a result, the significance of the charge card and a credit card are the aforementioned. Therefore, option (a) is correct.
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In 2017, Skylar sold an apartment building for $20,000 cash and a $300,000 note due in two years. Skylar’s cost of the property was $250,000, and he had deducted depreciation of $150,000, $60,000 of which was in excess of what the straight-line amount would have been.Do not round intermediate computations. Round your final answers to the nearest dollar.Under the installment sales method, Skylar's total realized gain is $___. In 2017, he recognizes § 1250 gain of $______ and § 1231 gain of $______.
In 2017, Skylar sold an apartment building for $20,000 cash and a $300,000 note due in two years. Skylar’s cost of the property was $250,000, and he had deducted depreciation of $150,000, $60,000 of which was in excess of what the straight-line amount would have been.Do not round intermediate computations. Round your final answers to the nearest dollar.Under the installment sales method, Skylar's total realized gain is $220,000. In 2017, he recognizes § 1250 gain of $10,000 and § 1231 gain of $10,000.
Property is any object that a person or a commercial enterprise has felony identify over. assets can be tangible items, along with homes, automobiles, or appliances, or it may seek advice from intangible items that convey the promise of future worth, inclusive of inventory and bond certificates.
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which is a form of direct marketing that involves tracking and analyzing the purchase patterns of specific customers?
Answer: Database Marketing
Explanation:
julia roberts has a bond issue outstanding that matures in four years. the bonds pay interest semiannually. currently, the bonds are quoted at 102.3 percent of face value and carry a coupon rate of 9 percent. what is the firm's after tax cost of debt if the tax rate is 35 percent?
Bond price =C*[1-(1+YTM)^-n / YTM] + [P/(1+YTM)^n]
Where,
C= Coupon amount =1000*9%*6/12 =45
YTM = Yield To Maturity
n = Number of periods =4*2 =8
P= Par value
Bond price =$1000*102.3% =1023
$1023=45 * [1 - (1 + YTM)^-8 / YTM] + [1000 / (1 + YTM) ^8]
$1023/45= * [1 - (1 + YTM)^-8 / YTM] + [1000 / (1 + YTM) ^8]
$22.7333= * [1 - (1 + YTM)^-8 / YTM] + [1000 / (1 + YTM) ^8]
YTM =4.16%
YTM(Annually)= 4.16 * 2 = 8.31%
After-tax cost of debt = cost of debt ×(1-tax rate)
=0.0831× (1-0.35)
=0.0831× 0.65
=5.4 %
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select the correct answer from each drop-down menu. choose the correct way term to complete each sentence on goods and services. ida has many errands to do today. first, she goes to a department store to try on some shirts. a shirt is an example of a(n) because it is . next, she goes to a restaurant to eat lunch. she could have gone to the grocery store to buy food for the entire week, but she chooses to sit and relax. however, as soon as she leaves the restaurant, the relaxing moment is over. this is because the restaurant experience is a and it is .
Services are defined as intangible advantages that are offered, whereas goods are tangible commodities that can be purchased for a fee. However, they both give the buyer value and enjoyment.
Tangible and intangible assets fall into two different groups. Tangible assets, such as computer equipment, are often tangible assets or property that a corporation owns. The primary asset class used by businesses to produce their goods and services are tangible assets.
Commodities are movable items that can be exchanged for other movable items, money, or both. They are goods that are offered for sale commercially.
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carol calculates that the total cost of serving 200 customers per day would be $1,600. what is the marginal cost of this increase in customers?
Carol calculates that the total cost of serving 200 customers per day would be $1,600 and 14 is the marginal cost of this increase in customers.
Marginal cost is that the cost to provide one extra unit of production. it's a vital conception in accounting as incremental cost helps verify the foremost economical level of production for a producing method. it's calculated by determinant what expenses square measure incurred if just one extra unit is factory-made.
Cost of serving is that the activity of value factors that go in the service of a client, or the assembly of a product. once paired with revenue, value to serve analysis allows you to accurately calculate gain by client, product sorts, production lines, facilities, processes.
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if sears department store managers looked at macy's department store prices for identical national brands and, based on that information, decided to advertise a sale on those products, they would be exercising which pricing method?
Sears department store managers would be using competition-based pricing.
Define competition-based pricing.Competitive based pricing, also known as competition-based pricing, refers to a pricing strategy in which your own price point is significantly influenced by that of your rivals. This tactic puts more emphasis on the market than it does on your expenses (Cost Plus Pricing). The tenet of competitor-based pricing is the conviction that market participants already know the answer and that every decision taken by rivals is wise. This can be a fair pricing strategy if just one company uses it, setting its prices after considering the current price range.
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if you invest $500 each month at an annual rate of 7%, in how many month will it become $300,000? the answer could be in decimals.
If you invest $500 each month at an annual rate of 7%, in 11.02 month it will become $300,000. To answer this, we need compound interest formula.
Here the equation is :
A= P[1+(r/n)]^(n*t)
Variable meaning:
A: Amount
P: Initial amount
R: Interest rate (decimal)
N: Number of times interest is compounded per year
T: Time (years)
Given in the question:
A = 300,000
P = 500
R = .07 (remember that when turning percent to decimal you move the decimal 2 to the left)
N = 12 (because there are 12 months a year)
T = ?
Plug into the equation:
300000 = 500 [1+ (0.07/12)] ^(12t)
Solve:
300000/500 = (1.05)^12t
600 = (1.05)^12t
Apply log on both sides,
log(600) = 12t log( 1.05)
2.778 = 12t*0.021
2.778/0.021 = 12t
13.28 = 12t
t = 11.02
Therefore, if you invest $500 every month for 11.02 months then the investment should total $300,000.
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a fire destroyed furniture and fixtures used in jock's business. jock's adjusted basis in the furniture and fixtures was $81,300. jock received a $100,000 reimbursement from his insurance company and immediately spent $93,000 to purchase new furniture and fixtures, and used the rest of the insurance proceeds to pay operating expenses. how much gain or loss must jock recognize on this involuntary conversion?
A fire destroyed furniture and fixtures used in jock's business. jock's adjusted basis in the furniture and fixtures was $81,300. jock received a $100,000 reimbursement from his insurance company and immediately spent $93,000 to purchase new furniture and fixtures, and used the rest of the insurance proceeds to pay operating expenses. how much gain or loss must jock recognize on this involuntary conversion? $11700.
Purchase price of new equipment = $93000
Adjusted basis of furniture and fixtures destroyed =$81300
Gain on conversion = $93000 - $81300 = $11700.
Repayment is repayment paid through an organization for out-of-pocket expenses incurred or overpayment made by an employee, client, or any other birthday celebration. repayment of business costs, insurance fees, and overpaid taxes are commonplace examples. however, in contrast to standard reimbursement, compensation isn't always situation to taxation.
KEY TAKEAWAYS
Compensation is money paid to an worker or client, or another celebration, as compensation for a business expense, insurance, taxes, or different expenses.
Business price reimbursements include out-of-pocket prices, inclusive of those for tour and food.
In line with diem fees are every day fees paid to personnel as compensation for enterprise journeys.
Tax refunds are a form of reimbursement from the authorities to taxpayers.
Organizations have a vested interest in ensuring that reimbursements are only supplied for valid reasons.
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b. suppose that while melissa was on the coast, she also spent two days sightseeing the national parks in the area. to do the sightseeing, she paid $1,650 for transportation, $1,035 for lodging, and $320 for meals during this part of her trip, which she considers personal in nature. what amount of the total costs can melissa deduct as business expenses?
Suppose that while melissa was on the coast, she also spent two days sightseeing the national parks in the area. to do the sightseeing, she paid $1,650 for transportation, $1,035 for lodging, and $320 for meals during this part of her trip, which she considers personal in nature. what amount of the total costs can Melissa deduct as business expenses? $0
None of the cost for sightseeing is deductible, because the primary purpose of the trip was business. She is not allowed to deduct any personal expenses like, meals, lodging, and transportation during sight visit.
Therefore, the amount of travel cost Mellissa deduct as business expenses is $0
Sightseeing is the hobby of going to a new vicinity and sorting out all the sights and cool capabilities of that area. walking around Atlantic city finding out the casinos and boardwalk is an example of sightseeing.
The definition of a capability is some thing that someone or aspect is able to do. whilst someone can cook dinner, this is an example of a situation where he has the functionality to cook dinner. when a pc can open a file, this is an example of a state of affairs wherein the pc has the capability to open the report.
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5) if rrr(required reserve ratio) is larger, is the money multiplier bigger or smaller? why? explain based on the formula. ( 2 points)
If banks lend more than their reserve requirement allows, their multiplier rises, resulting in more money supply. If banks lend less, their multiplier will be lower, and the money supply will be reduced as well.
What do you know about Money supply?
The money supply (or money stock) is the total amount of currency held by the public at any given time. There are several ways to define "money," but standard measures typically include currency in circulation (i.e., physical cash) and demand deposits (depositors' easily accessible assets on financial institutions' books). A country's central bank may use a definition of what constitutes legal tender for its own purposes. Money supply data is recorded and published, typically by a government agency or the country's central bank. Changes in the money supply are monitored by public and private sector analysts because it is believed that such changes affect the prices of securities, inflation, exchange rates, and the business cycle.
So, If banks lend less, their multiplier will be lower, and the money supply will be reduced as well.
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Tracy Williams deposits $500 that was in her sock drawer into a checking account at the local bank. a. How does the deposit initially change the T-account of the local bank? How does it change the money supply? b. If the bank maintains a reserve ratio of 10%, how will it respond to the new deposit? c. If every time the bank makes a loan, the loan results in a new checkable bank deposit in a different bank equal to the amount of the loan, by how much could the total money supply in the economy expand in response to Tracy's initial cash deposit of $500? d. If every time the bank makes a loan, the loan results in a new checkable bank deposit in a different bank equal to the amount of the loan and the bank main- tains a reserve ratio of 5%, by how much could the money supply expand in response to Tracy's initial cash deposit of $500?
a. This deposit increases the bank's reserves by $500 and also increases the money supply by the same amount.
b. If the bank maintains a reserve ratio of 10%, it will respond to the new deposit by holding 10% of the deposit as reserves and loaning out the remaining amount.
c. The total money supply in the economy could potentially expand by $5000 in response to Tracy's initial cash deposit of $500.
d. The total money supply in the economy could potentially expand by $10,000 in response to Tracy's initial cash deposit of $500.
a. When Tracy Williams deposits $500 in her sock drawer into a checking account at the local bank, the T-account of the local bank will be affected as follows:
T-account of the local bank:
Assets: +$500 (increase in reserves)
Liabilities: +$500 (increase in deposits)
This deposit increases the bank's reserves by $500 and also increases the money supply by the same amount. The money supply increases because deposits in banks are considered part of the money supply, specifically the M1 money supply which includes currency and checkable deposits.
b. The reserve ratio is the fraction of deposits that a bank is required to hold as reserves, and the rest can be loaned out to borrowers.
Initial deposit = $500
Reserve ratio = 10%
Reserves held by the bank = $500 × 0.10 = $50
Loan amount = $500 - $50
= $450
c. If every time the bank makes a loan, the loan results in a new checkable bank deposit in a different bank equal to the amount of the loan, the total money supply in the economy could expand by a multiple of Tracy's initial cash deposit.
Initial deposit = $500
Money multiplier = 1 / Reserve ratio
Money multiplier = 1 / 0.10 = 10
Total potential money supply expansion = Initial deposit × Money multiplier
Total potential money supply expansion = $500 × 10 = $5000
So, the total money supply in the economy could potentially expand by $5000 in response to Tracy's initial cash deposit of $500.
d. If every time the bank makes a loan, the loan results in a new checkable bank deposit in a different bank equal to the amount of the loan, and the bank maintains a reserve ratio of 5%, the money supply could expand even further.
Reserve ratio = 5%
Money multiplier = 1 / 0.05 = 20
Total potential money supply expansion = Initial deposit × Money multiplier
Total potential money supply expansion = $500 × 20 = $10,000
So, the total money supply in the economy could potentially expand by $10,000 in response to Tracy's initial cash deposit of $500.
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question 2 electronic stability control reduces the risk of rollover crashes, such as are common with suvs. a) true b) false
It is true that electronic stability control lowers the danger of rollover collisions, which are frequent in SUVs.
What is a commercial illustration of risk?Harm brought on by a natural disaster, as a fire or a flood. unforeseen economic loss imposed on by a downturn in the economy or the demise of a business you owe money to. substantial loss of suppliers or customers. The loss of market share is due to new competitors or products.
What does risk look like?Any chance—high or low—that a danger may actually cause harm to someone is a risk. Working alone outside of your office, for instance, might present risks. Potentially high personal risk exists. Electric wiring is dangerous.
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you take $500,000 out of your sock drawer and provide yourself with a 15-year annuity. assuming a 10% interest rate, how much will this annuity be?
This annuity will be 3333.33. Annuities are primarily utilised in interest rate and assist people in reducing the danger of outliving their assets.
Drawer = $500,000
Annuity= 15 year
Interest rate= 10%
$500,000*10%/15
= 3333.33
The term "annuity" refers to an insurance contract that financial institutions have created and disseminated with the goal of paying out invested money as a fixed income stream in the future.
Annuities are bought or invested in by investors using monthly premiums or one-time lump sum payments. For a predetermined amount of time or for the length of the annuitant's life, the holding institution issues a stream of payments in the future.
Annuities are primarily utilised in retirement and assist people in reducing the danger of outliving their assets. Financial products known as annuities provide retirees with a guaranteed income source.
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