Analyze the effect on the country of the president’s decision-making.How did it impact the relationship with the American people?Congress?
May 1, 2020Identify the market type that most closely approximates your chosen industry. (Monopoly. Oligopoly, Monopolistic Competition, or Pure Competition).
May 1, 2020Question Description
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- Joan has the following assets and liabilities:
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| Credit card balance | $1,000 |
| Cash | $200 |
| Government bonds | $3,000 |
| Checking | $300 |
| Car loan balance | $10,000 |
| Car | $15,000 |
nWhat is Joan’s money demand?nnA) $200nnB) $300nnC) $500nnD) $1,500nn2) Jim has the following assets and liabilities:n
| Credit card balance | $1,000 |
| Cash | $500 |
| Government bonds | $3,000 |
| Checking | $750 |
| Car loan balance | $10,000 |
| Car | $15,000 |
nWhat is Jim’s money demand?nnA) $500nnB) $750nnC) $1,250nnD) $3,250nn3) Refer to the given figure where the nominal interest rate equals 6 percent and the money supply equals 600.nnIf the Federal Reserve wants to lower the interest rate to 4 percent, it must ________ the money supply to ________.nnA) increase; 800nnB) decrease; 800nnC) increase; 1,000nnD) decrease; 400nn4) Refer to the given figure where the nominal interest rate equals 6 percent and the money supply equals 600.nnIf the Federal Reserve wants to raise the interest rate to 8 percent, it must ________ the money supply to ________.nnA) increase; 800nnB) decrease; 800nnC) increase; 400nnD) decrease; 400nn5. In Tivland, currency held by the public is 2,000 naira, bank reserves are 300 naira, and the desired (and current) reserve/deposit ratio is 15 percent. If commercial banks borrow 100 naira in reserves from the Central Bank through discount window lending, then the money supply in Tivland will ________, assuming that the public does not wish to change the amount of currency it holds.nnA) increase to 3,133 nairannB) increase to 4,100 nairannC) increase to 4,667 nairannD) decrease to 1,900 nairann6) If the Federal Reserve wants to lower interest rates via open market operations, should it buy bonds, or should it sell bonds? EXPLAIN (20POINTS)nn7. How can the federal reserve bank use monetary policy to control the two economic issues of inflation and unemployment? EXPLAIN. (20 POINTS)nn8. Not all investors are interested in accepting extra risk in order to receive a higher return. Investors can be classified as risk adverse, risk neutral, or risk seeking. To determine the risk associated with an investment, calculations are made to determine the risk-free rate and the risk premium associated with the investment.n
| Security 1 | Security 2 | Security 3 | ||
| Risk-free Rate of Interest | 3.00% | 3.00% | 3.00% | |
| Various Risk Rates | ||||
| Interest Rate Risk | 1.00% | 1.50% | 1.25% | |
| Credit Risk | 0.50% | 0.25% | 0.25% | |
| Inflationary Risk | 0.50% | 0.50% | 0.50% | |
| Liquidity Risk | 0.25% | 0.25% | 0.50% | |
| Market Risk | 0.50% | 0.50% | 0.50% | |
| Business Risk | 1.25% | 0.50% | 1.50% | |
| Security 1 | Security 2 | Security 3 | ||
| (a)Risk Premium | ||||
| B) Expected Annual Return* | ||||
| QUESTIONS: Fill in the blank spaces for risk premium and expected annual return.nn(10 points) | ||||
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