This topic contains a solution. Click here to go to the answer

Author Question: Assuming a required reserve ratio of 10 and the Fed purchased 1 million worth of mortgage-backed ... (Read 78 times)

Mimi

  • Hero Member
  • *****
  • Posts: 542
Assuming a required reserve ratio of 10 and the Fed purchased 1 million worth of mortgage-backed securities, make use of the simple deposit multiplier to determine how much checking deposits would change.
 
  A) increase by 1 million
  B) increase by 10 million
  C) decrease by 1 million
  D) decrease by 10 million

Question 2

What impact do savings rates in Belgium have on the real interest rate that businesses in Belgium must pay to obtain the funds to finance their spending on plant and equipment?
 
  What will be an ideal response?



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

djpooyouma

  • Sr. Member
  • ****
  • Posts: 325
Answer to Question 1

A

Answer to Question 2

Because Belgium is a small open economy, the domestic real interest rate will equal the world real interest rate. Because domestic saving in Belgium has no effect on the world real interest rate, the savings rate in Belgium has no impact on the real interest rate at which businesses in Belgium are able to borrow funds.




Mimi

  • Member
  • Posts: 542
Reply 2 on: Jun 30, 2018
Wow, this really help


fatboyy09

  • Member
  • Posts: 358
Reply 3 on: Yesterday
YES! Correct, THANKS for helping me on my review

 

Did you know?

The horizontal fraction bar was introduced by the Arabs.

Did you know?

Though the United States has largely rejected the metric system, it is used for currency, as in 100 pennies = 1 dollar. Previously, the British currency system was used, with measurements such as 12 pence to the shilling, and 20 shillings to the pound.

Did you know?

The oldest recorded age was 122. Madame Jeanne Calment was born in France in 1875 and died in 1997. She was a vegetarian and loved olive oil, port wine, and chocolate.

Did you know?

More than 34,000 trademarked medication names and more than 10,000 generic medication names are in use in the United States.

Did you know?

Though Candida and Aspergillus species are the most common fungal pathogens causing invasive fungal disease in the immunocompromised, infections due to previously uncommon hyaline and dematiaceous filamentous fungi are occurring more often today. Rare fungal infections, once accurately diagnosed, may require surgical debridement, immunotherapy, and newer antifungals used singly or in combination with older antifungals, on a case-by-case basis.

For a complete list of videos, visit our video library