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- Q15An increase in the money demand, with money supply held constant, means that we will observe O a. A higher level of GDP O b. A rise in the price of bonds O c. A rise in interest rates O d. All of the answers are correctAccording to the liquidity preference theory, if the money supply increases, then, ceteris paribus, bond prices... O a. Stay the same. O b. Rise as the interest rate rises. Rise as the interest rate falls. O c. O d. Fall as the interest rate rises. O e. Fall as the interest rate falls.
- 5. Economists continue to be puzzled by the appar- ent home bias of investors across countries. With mean-variance preferences, investors ought to allo- cate much more of their wealth to foreign equities and bonds. Three explanations for the phenomenon are given below, all of them based on empirical facts. For each one, discuss whether the statements are true or false and in what sense they help, or fail, to rationalize the home bias puzzle. In answering the questions, assume that investors have mean- variance preferences. a. Investors should not hold foreign equities be- cause they are more volatile and have been yielding lower returns than U.S. stocks in re- cent years. b. Home bias arises because investors face an ad- ditional risk when investing internationally— namely, currency risk. Because currency risk makes returns more volatile but does not lead to a higher expected return, investing more in domestic…Use the figure below to answer the following questions. Interest rate 0 MD₂ MD₂, MD, Real money (billions of 2002 dollars) Select one: O A A movement from A to F O B. A movement from A to C OC. A movement from A to E O D. A movement from A to B O E. A movement from E to A Figure 24.5.2 Refer to Figure 24.5.2. Which one of the following best describes the response to a decrease in the market price of bonds?Need asap...
- Suppose that the Federal reserve is concerned about the effects of rising stock prices on the economy. What could it do? a. buy bond to raise the interest rate b. buy bonds to lower the interest rate INCORRECT c. sell bonds to raise the interest rate INCORRECT d. sell bonds to lower the interest rate I thought the answer was B. BUT My results tell me option B. is incorrect.... Another chegg question shows option C. as incorrect as well... Please help?How would I complete letters E, F, G, and H?8 of 38 Janelle is an investor looking at the bond market for an investment opportunity. If Janelle knows that 1-year interest rates for the next three years are expected to be 4, 2, and 3 percent, and the 3-year term premium is 1 percent, then the 3- year bond rate will be O A. 2 percent O B. 1 percent O C. 4 percent O D. 3 percent Unsure
- People often run up high credit card debts because they fail to fully appreciate the difference between simple and compound interest rates. Which of the following statements is true? Please select the correct answer. O a. Setting a maximum limit to the debt is a "boosting" technique to address this issue. O b. None of the other answers is correct. O c. Providing people with quick training on interest rates is a “nudging" technique to address this issue. O d. An asymmetric paternalist would favour a "nudge" to address this issue as long as it benefits non-perfectly rational agents. O e. This is an example of framing effects.moodle.unizwa.edu.om/mod/quiz/attempt.p If there is a surplus of a commodity, then, the price will rise 9 J5- شير مجلب عليه بول إخكر واحدان الدرجة من 0.50 علم هذا السؤال ths O Financial intermediaries are financial institutions through which savers can directly provide funds to borrowers 10 J- J alo daa o إختر واحدا 0.50 ga da l علم هذا السؤال thi O .Gold is an example of Fiat money 11 J عبر مجاب عليه بوز إختر واحدان الدرجة من 0.50 علم هذا السؤال TOSHIBA B/O 2111 & 6 7 7 V 50 8 A 99 FJ GY VI BYWhen land prices become more volatile, the demand curve for bonds shifts to the and the interest rate Select one: a . right ; rises b . right ; falls c. left; falls Od. left; rises