This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: Assuming a required reserve ratio of 10 and the Fed purchased 1 million worth of mortgage-backed ... (Read 66 times)

Mimi

  • Hero Member
  • *****
  • Posts: 542
on: Jun 30, 2018
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
Reply #1 on: Jun 30, 2018
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

lcapri7

  • Member
  • Posts: 350
Reply 3 on: Yesterday
Great answer, keep it coming :)

« previous next »
 

Did you know?

Only one in 10 cancer deaths is caused by the primary tumor. The vast majority of cancer mortality is caused by cells breaking away from the main tumor and metastasizing to other parts of the body, such as the brain, bones, or liver.

Did you know?

Asthma occurs in one in 11 children and in one in 12 adults. African Americans and Latinos have a higher risk for developing asthma than other groups.

Did you know?

Less than one of every three adults with high LDL cholesterol has the condition under control. Only 48.1% with the condition are being treated for it.

Did you know?

All adverse reactions are commonly charted in red ink in the patient's record and usually are noted on the front of the chart. Failure to follow correct documentation procedures may result in malpractice lawsuits.

Did you know?

Limit intake of red meat and dairy products made with whole milk. Choose skim milk, low-fat or fat-free dairy products. Limit fried food. Use healthy oils when cooking.

Spur-winged Goose - De Hoop Nature Reserve, South Africa Spur-winged Goose - De Hoop Nature Reserve, South Africa
The cranium of early African H. erectus KNM-ER 3733 is nearly 1.8 million years old. The cranium of early African H. erectus KNM-ER 3733 is nearly 1.8 million years old.
During World War I, advancing armies unloosed ferocious artillery barrages to destroy deeply entrenc During World War I, advancing armies unloosed ferocious artillery barrages to destroy deeply entrenc
Sequential blending uses a computer to calculate the correct ratio as well as the prescribed order ... Sequential blending uses a computer to calculate the correct ratio as well as the prescribed order ...
Pangaea 200 Million Years Ago Pangaea 200 Million Years Ago
Nine $10 000, 4% bonds with interest payable semi-annually and redeemable at par are purchased ... Nine $10 000, 4% bonds with interest payable semi-annually and redeemable at par are purchased ...
Video: Introduction to Spirometry

For a complete list of videos, visit our video library