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C = 200 + 0.8Yd
I = 220 – 25i
G Bar = 240
TR BAR = 150
T = .2Y
L = .1Y – 3i
M/P = 125
The equilibrium interest rate and output combination is
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- Using the following data, calculate the equilibrium interest rate Y=7,000G=4000T=2,000C=150+0.75(Y-T)I=1,000-50rPublic Savings = -2000Private savings = 1100National Savings = -900How would the price of the bond be affected by changing the going market interest rate? (Hint: Conduct a sensitivity analysis of price to changes in the going market interest rate for the bond. Assume that the bond will be called if and only if the going rate of interest falls below the coupon rate. That is an oversimplification, but assume it anyway for purposes of this problem.)Suppose a(t) = 0.0015 (t-3)4 +0.042 (1-2)³ + 1.2145. Calculate values of a(t) and the effective rate of interest, i, for integer values of t from 0 to 50 (no need for an effective rate at t = 0). Then graph the values of the effective rates of interest Round the a(t) values to 3 decimal points and round the interest rates to 2 decimal in percentage form. points
- you were offered either a simple interest note or a simple discount note with the following terms: $21,399 at 8% for 36 months. calculate the effective interest rate. (do not round intermediate calculations. round your final answer to the nearest tenth percent.): Effective interest rate: ??Dell Computer makes its suppliers wait 37 days on average to be paid for their goods; however, Dell is paid by its customers immediately. Thus, Dell earns interest on this float, the money that it is implicitly borrowing. If Dell can earn an annual interest rate of 4%, what is this float worth to Dell per dollar spent on inputs?A. Given: C = 700 + .80 (1- t)Y, t=0.25 I = 210 -75i; G= 1000; TR=100 L= 0.20Y- 40i ; M/P = 800 Compute: 1. The equilibrium income and the equilibrium interest rate
- The demand D (in billions of £) for a bond with coupon rate 5% and face value FV = 1000, and two years to maturity as a function of its price P is D = 4000 − 2P. The supply in (billions of £) as a function of the price of the bond is S = 2P+ 400. What is the equilibrium interest rate?The central bank is selling $100 worth of bonds payable in one year. The price it gets today is $98. What is the implicit interest rate? (If you get 0.0112, please write 1.12)For an IS/LM model of an economy with the following equations: C = 200 + 0.8Yd | = 220 – 25i = 240 = 150 TR T= .2Y L= .1Y – 3i M. = 125 The equilibrium interest rate and output combination is (3, 125) (30, 1250) (9.2, 1526) (69.5, 2168.4)
- For an IS/LM model of an economy with the following equations: C = 200 + 0.8Yd | = 220 - 25i = 240 TR = 150 T= .2Y L=.1Y- 3i M= 125 The equilibrium interest rate and output combination is O (30, 1250) O (9.2, 1526) . O (69.5, 2168.4) (3, 125)Suppose Ford Motor Company issues bonds with a face value of $500 and an annual coupon payment of $20 What is the interest rate Ford is paying on the borrowed funds? The interest rate is percentQuestion 14 4. To meet the equilibrium point given the level of output is constant, how much increase in interest rate is necessary? 1.2 0.8 0.6 0.4 0.2 20 40 60 80 100 120 140
