What group of people benefits from a higher interest rate? Explain how they benefit

Q: to show the on the Market for Loanable Funds of many people deciding to play the lottery rather than…

A: If the people decides to play lottery rather than save money for investment then it leads to a fall…

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: Do the interest rates reflect the market interest rate?

A: An amount of money due per period as a proportion of the loan, deposit, or borrowing amount is…

Q: Suppose that the interest rate is 4 percent. What is the future value of $100 four years from now?…

A: Interest rate = 4%Principal amount = $100

Q: What advantage do you have if you begin investing for retirement at a young age? There is no…

A: The various entities in the economy earn income through different ways, and avenues, and they have…

Q: How do people typically respond to higher real interest rates? by saving less by paying more taxes…

A: Since you have asked multiple questions, we will solve the first question for you. If you want any…

Q: A family of four has an income of $15,000 today and will earn $24,000 tomorrow. If the family…

A: Introduction Here total income of two period = $15,000 + $24,000 = $39,000 Consumption of the family…

Q: a) When the demand of output decides how much to produce which type of demand prevails in the…

A: Ans. 4(a) Demand is defined as an economic principle that explains a consumer's desire to buy or…

Q: “An increase in a country's population is likely to raise the real interest rate.

A: The IS curve represents the equilibrium in the goods market. The equilibrium in goods market is…

Q: Suppose that the city of New York issues bonds to raise money to pay for a new tunnel linking New…

A: Investment is considered an important component of economic growth. It can be categorized into two…

Q: Explain how higher savings leads to a higher standard of living.

A: The savings is the money that people keep with them without spending for their consumption purpose.…

Q: At 1% interest rate, how much should you invest today to be able to withdraw ₱ 3,053 annually for 8…

A: 1% interest rate is given monthly , where he withdraw 3053 annually for 8years . And payment is done…

Q: Using the concepts of real interest rate and expected rate of return, test the relationship between…

A: The link between saving and investment is a major source of disagreement in macroeconomics. Before…

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: Consider that you were given a US savings bond that will pay $100 when it matures in ten years. What…

A: Bonds are tradable assets that are securitized versions of corporate debt issued by businesses.…

Q: What are the different types of investmen

A: Investment is the new expenditure on physical assets such as machines, buildings, tools and…

Q: 1. A consumer, who is initially a lender, remains a lender even after a decline in interest rates.…

A: A decline in rates of interest would tend to make borrowing money cheaper that would encourage…

Q: what are the economic goals of a low-interest rate?

A: The presence of interest helps borrowers to spend money right away rather than waiting to save up…

Q: Distinguish between saving and investment.

A: An important debate in macroeconomics relates to the relationship between saving and investment.…

Q: Provide two examples of changes in the market for loanable funds that can result in a change in the…

A: Since the questions asked multiple questions. According to our policy, we can only answer 1 question…

Q: all else equal, what does a lower interest rate mean for firms? what does a lower interest rate…

A: Interest rate positively related with the savings and negatively related with the investment. When…

Q: Financial institutions have warned that increased life expectancy means that many people have not…

A: Consumption  Consumption is the way that households consume products and services. Contrary to…

Q: It has been said that a society with high savings rate is a society with a high standard of living.…

A: (Q) It has been said that a society with a high savings rate is a society with a high standard of…

Q: Explain/Discuss Three ways that a reduced rate of interest influences real capital investment.

A: Real capital investment is the sum of money which is given to a company to achieve it business…

Q: Who benefits from an increase in interest rates? O people who are borrowing money O no one O people…

A: Interest rate: The interest rate is the rate or the proportion of an amount the lender or bank…

Q: Suppose you received a US savings bond as a gift, and the bond pays $100 at maturity, which is ten…

A: Bond is a financial instrument that ensures a fixed income to the buyer or the investor.

Q: Explain the role of interest rates in allocating capital, modulating R&D spending, and helping…

A: An interest rate is the percentage of principal being charged by the lender for use of its money.…

Q: What is the relationship between interest rates and business investment?

A: To determine the relationship between interest rates and investments.

Q: For each of the following pairs, which bond would you expect to pay a higher interest rate? Explain!…

A: Hello, thank you for the question. Since there are multiple questions asked here, only the first…

Q: For each of the following pairs, which bond would you expect to pay a higher interest rate? Explain!…

A: Bonds are defined as the fixed income securities issued by the private companies and government…

Q: Explain Three ways that a reduced rate of interest influences real capital investment.

A: Answer - Need to find- Explain Three ways that a reduced rate of interest influences real capital…

Q: discuss the relationship between the coupon rate, the market rate of interest and the price of bond

A: The bond stated interest rate will not change the market interest rate will be constantly changing…

Q: Describe the process of Calculating Present Value?

A: PV formula  Present value = Future value/ (1+r)n r= rate of return n = number of periods

Q: Using the accompanying diagram, explain what will happen to the market for loanable funds when there…

A: Loanable Funds Market is the one where where the activity of borrowing takes place. Here, savers…