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Author Question: Explain what the term structure of interest rates represents. What will be an ideal ... (Read 52 times)

kaid0807

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on: Jun 30, 2018
Explain what the term structure of interest rates represents.
 
  What will be an ideal response?

Question 2

What is the money multiplier and what factors determine its size?
 
  What will be an ideal response?


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sultana.d

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Reply #1 on: Jun 30, 2018
Answer to Question 1

The term structure of interest rates illustrates the relationship between the yield to maturity on bonds (with the same risk characteristics) and maturity.

Answer to Question 2

The money multiplier represents the effect of a given change in high powered money on the money supply. The money multiplier will be affected by changes in two parameters: c and . An increase in either parameter will cause a reduction in the money multiplier.


kaid0807

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Reply 2 on: Jun 30, 2018
Great answer, keep it coming :)

ktidd

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Reply 3 on: Yesterday
Gracias!

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