In the financial market, if the quantity of funds demanded is greater than the quantity of funds supplied then we can expect interest rates to fall over time. True False

Q: Investment projects can be viewed as analogous to bank loans. True or false?

A: An investment project is a proposal that includes information on the expenditure of the planned…

Q: Lowering the taxes on income can help in expanding the activities in the financial market.  True or…

A: Tax in the compulsory payment made by the individual or institution to the government without…

Q: Economic conditions have an inverse impact on the equilibrium interest rate with regard to the…

A: Economic conditions do have an inverse impact on the equilibrium interest rate with regard to the…

Q: If the central bank’s goal is to maximize output, what interest rate will we expect in equilibrium?

A: The equilibrium real interest rate is the real rate of return which must be maintained to keep the…

Q: 1. What will happen to interest rate, price of bonds and quantity of bonds if interest rates are…

A: Answer: There is an inverse relationship between interest rate and the price of bonds. If the…

Q: Activities in financial markets have direct effects on individual wealth, the behavior of business,…

A: In the case of individuals' wealth real estate market also has a significant effect on an…

Q: Suppose that Intel is considering building a new chip-making factory. Assume that Intel needs to…

A: Changes in interest rate will affect the decision of borrowing money in the bond market.

Q: Suppose the law changes and the corporate income tax rate has been cut in half.  As a result,…

A: Due to cut in corporate income tax, corporation decides to purchase new buildings and equipment.…

Q: To understand the paradox of thrift, it is necessary to assume that investment is unrelated to…

A: This can be defined as a concept that shows the commodities and services used by the individual or…

Q: True or false, with explanation Suppose the bank deposit has 30% annual interest rate. It implies…

A: When talking about deposit interest rate, it is the annual rate of return for the people when they…

Q: What is a liquidity crisis?

A: Answer: Liquidity: liquidity refers to the ease at which the assets can be converted to cash.

Q: An increase in the interest rate will cause an increase in the demand for money. True False

A: Demand for money depicts when people demand more money to fulfil their needs and wants. It depends…

Q: What are the financial markets? What are the parties of the capital market?Explain it.

A: For the smooth operation of a capitalistic system, entrepreneurs and businesses rely on finance that…

Q: The decrease in savings causes the decrease in supply of loanable funds.   Select one: True False

A: The main source of loanable assets is saving. Families set aside cash, these investment funds are…

Q: Suppose that people in France decide to permanently increase their savings rate. Predict what will…

A: An amount that is being set aside by individuals for their future consumption is known as savings.…

Q: ark

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

Q: Providing tax shelters through investment is one of the main functions of the financial system. *…

A: Tax shelters are necessary, despite the fact that they are sometimes seen negatively. Individuals…

Q: Financial institutions such as banks pays lower interest rates to depositors and charge higher…

A: Democratic government is a type of government in which there is both public and private sector…

Q: The typical savings supply curve has a positive slope. If a nation's saving supply curve is…

A: People in this country save the same amount no matter what the interest rate is.Let's break down why…

Q: analyzes the responsibility of the financial system in the demand for investment versus the supply…

A: The financial system's primary economic role is to transfer cash from net savers (those who spend…

Q: The Fed is responsible for adjusting the prime interest rate? True or False

A: FED: The Federal Reserve System, regularly alluded to as the Federal Reserve or basically "the Fed,"…

Q: Chairman Latrobe, the Supreme Leader of Rolling Rock decided to        increase the personal tax…

A: Note: Since you have posted multiple independent questions in the same request, we will solve the…

Q: The central bank decided to raise interest rates when it wanted to reduce aggregate demand to fight…

A: Introduction Central bank is the head bank of the country all the commercial bank and public sector…

Q: Suppose that Intel is considering building a new chip-making factory a. Assuming that Intel needs to…

A: Purchase of an asset in the present period with the hope that it will generate income in the…

Q: What role do interest rates play in consumer spending and savings, and how do central banks use…

A: An interest rate is charged on the borrowing money by consumers. It is charged by the lender of the…

Q: market both before and after the increase in foreign savings? c. How does the change in foreign…

A: Economic growth is an increase in the production of services and goods over a specific period of…

Q: Which of the following is (are) likely to lead to an increase in the demand for US bonds? a. All of…

A: Bonds are financial instruments used to raise capital by governments, corporations, and other…

Q: Market interest rates are established by the banks or any financial institutions. True or false?

A: Answer -  Market Interest rate - It is the interest rate given on the deposits or other investments…

Q: If the supply of financial capital increases   Interest rates will remain unchanged.   Interest…

A: Interest rate is determined by the demand and supply of financial capital.

Q: In case government increases taxes and government spending by equal amount, what is the impact of…

A: This multiplier calculates the impact on GDP of increasing both government expenditure and taxes at…

Q: As the interest rates decline, the amount of money the public holds rise. True or False

A: Interest rate play an important role in the people's decision to hold money.

Q: Why do credit spreads risesignificantly during a financial crisis?

A: Credit Spread refers to the difference in the yield obtained on financial fixed income instruments…

Q: anks continue to offer new services (such as insurance or securities services), their noninterest…

A: In an economy, banking sector is one of the important sectors because it provides financial services…

Q: In the long run, what are the factors that will lead to lower interest rates? Elaborate answer in…

A: The interest rate is the cost at which commercial banks lend to the general public. With the loan…

Q: Changes in the money supply affect the interest rate through changes in the supply of loans, real…

A: Loanable funds is defined as the theory for determining rate of interest in the market. The demand…

Q: Distinguish between Market and Inflation-Free Interest Rates?

A: The Market interest Rate, also called the nominal interest rate (i) is the rate which is not…

Q: What would the second and third round of loans increase by

A: The reserve requirement is the amount of funds a bank holds in reserve to ensure that it is able to…

Q: From our discussion of interest rate frameworks, we can guess that the demand for liquidity is…

A: Liquidity refers to the flow of money into the economy which increased when the banks lower the rate…

Q: 31. Table 4.6 shows the amount of savings and borrowing in a market for loans to purchase homes,…

A: Market is said to be in equilibrium when the demand is equal to supply. The point where the market…

Q: Explain the bond markets in the real world.

A: A bond is an advance that the bond buyer, or bondholder, makes to the bond backer. Governments,…

Q: Suppose the current economy requires $6 million for transactions. The table below shows the interest…

A: The total asset demand when the interest rate is 6 percent can be calculated by referring to the…

Q: If there is a surplus of a commodity, then, the price will rise إخكر واحدان thi O

A: Disclaimer: Since you have asked multiple questions, we solve the first one for you. If you require…

Q: Which three factors will shift the supply of bonds to the left?

A: In economics, the concept of supply is used to determine the quantity of a commodity or service…