What is the relationship; remember how economist talk about relationships, between the level of investment and the interest rate? Which is the independent variable? What is the most intuitive way for you to remember this? Remember, do not memorize; find a story to tell.

Q: Explain the difference between the stock variable and a flow variable in economics with one example…

A: According to the given question While analysing in general the economic problems the economics uses…

Q: Which of the following should NOT be considered as part of fixed investment? 1. Toyota buys a new…

A: According to the economist investment is such a concept which focuses on the goods production in…

Q: Looking at business fixed investment, elaborate on why investment is negatively related to the…

A: Investments are negatively related rate of interest.

Q: Optimizing economic agents use the real interest rate when thinking about the economic costs and…

A: The real average savings rate = Nominal rate- rate of inflation   = 0.75-1.65%  = (-)0.9% If banks…

Q: Define and explain the internal rate of return on a new investment?

A: Internal rate of return or IRR is a measure in economics of  capital budgeting parlance and…

Q: Long run real interest rates are expected to increase. How will an accountant and economist view the…

A: An interest rate that has been modified to take inflation into consideration is known as a real…

Q: What is meant by the rate of interest. How is the rate of interest determined? Explain in 500 words.

A: The interest rate represents the cost of money to a borrower and the return on invested money to an…

Q: "Capital is a flow and income is a stock" True/False

A: # If a quantity is being measured at a perticular point of time then it is stock and if a quantity…

Q: Describe nonsimple investment?

A: Non simple investment is a type of investment where more than one sign change occurs in the net cash…

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: A friend asks you to explain the difference between saving and investment. Explain the difference.

A: The individuals and households earn income from various sources which is then used by them for…

Q: explains interest rate and its determinants. Please explain is 3 paragraph

A: The policy which includes changes in the interest rate and open market operations to stabilize the…

Q: Why would planned investments might be different than actual investments? And what does it mean?

A: A planned investment is the total amount of money that a company or person plans to spend over a set…

Q: The following table contains data on the relationship between saving and income. Rearrange these…

A: Savings represent that part of a consumer’s income which is not used for consumption and is not paid…

Q: a. Derive and graph the IS and LM curves. Use the accompanying diagram to graph the IS and LM curves…

A:

Q: What is Capital expenditure?

A: Capital expenditure refers to expenditure made by the firms in tangible assets such as land,…

Q: This person earns $1000 of income today and $2000 income next year. Point C represents his…

A: The budget line/constraints for a two-period consumption is given by [Ct+Ct+1/rt+1]=[Yt+Yt+1/rt+1]…

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: Which type of investment is called a mixed investment?

A: Investment refers to the purchase of an asset that entails greater payoff in the form of increased…

Q: d) Distinguish between stock and flow variables. Are flow variables related to stock variables and…

A: The development of economic variables is dependent on stock and flow variables. Stock variable…

Q: If Net Investment = 0 in a given year, this indicates that we have neither lost nor gained capital.…

A: If Net Investment = 0 in a given year, this indicates that we have neither lost nor gained capital.…

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 is the relationship; remember how economist talk about relationships, between the level of…

A: The equilibrium of the national income including the real GDP and the price level would be…

Q: What is the Net-investment test?

A: Net- investment measures the company's assets and investment like property, software, plants and…

Q: Why is savings equal to investment

A: Saving is the portion is income that is not used in consumption and thus does not include in income…

Q: 5. Explain the difference between investment as the term is used by most people and investment as…

A: Investment- Investment means to invest the money in productive and non productive activities to…

Q: Optimizing economic agents use the real interest rate when thinking about the economic costs and…

A:

Q: Mathematically derive slope of IS curve. Prove that if investment does not depend oni interestrate,…

A: The IS curve shows the negative relationship between interest rate and real GDP where the goods…

Q: Suppose that a friend of yours recently opened her own business. She is happy because it generated…

A: An organization or entrepreneurial entity engaging in commercial, industrial, or professional…

Q: What is the break even investment

A: The relationship that exists between fixed costs, variable costs, and returns can be studied by…

Q: Suppose a handbill publisher can buy a new duplicating machine for $500 and the duplicator has a…

A: The expected rate of return r is calculated as follows: Return = expected Revenue - cost r =…

Q: Suppose the economy moves into recession and there is general pessimism about the future economic…

A: A Fall in the GDP for consecutive two quarter is known as the recession. The aggregate demand…

Q: Define the term Return on Investment?

A: Return on investment measures the performance which is used to evaluate the efficiency of an…

Q: Define the term the concept of return on investment?

A: Return on investment measures the performance which is used to evaluate the efficiency of an…

Q: What is the result of investments?

A: The amount of products purchased or accumulated per unit of time that are not utilised at the…

Q: What would be the value of sales given that value of output is $31,000 and changs in stock is…

A: The data presented in the question above is:- Value of output = $31,000 Change in stock = $10,000 We…

Q: Describe the simple investment?

A: Investment refers to buying financial assets like shares and bonds to earn interest rates. Rate of…

Q: Explain why an increase in the interest rate reduces the amount of residential investment

A: Interest rates impact the level the residential investment.

Q: real interest rate

A: The real interest rate depicts that interest rate which is adjusted to inflation rate, it does not…

Q: Suppose consumption in year 2 (C2) is on the horizontal axis and consumption in year 1 (C1) is on…

A: In economics, the intertemporal problem explains how a consumer make choice between the present and…

Public Saving

Public saving deals with the amount which has been in excess after meeting all the obligatory expenses and investment of the government. Taxes are collected by the government to meet its day-to-day expenditures. The obligatory expenses include all those expenses which are mandatory for the government. It cannot be avoided as it is inevitable.