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- 12. If the quantity of money demanded is less than quantity of money supplied, then the interest rate will: a) change in an uncertain direction. (b) rise. (c) remain constant (d) fall.Figure 2: MS Interest Rate (%) 10% 6% 4% MD 500 800 1,000 Money ($ million) 23. Refer to Figure 2. At an interest rate of 4%, there is: a) an excess supply of money of $200. b) an excess supply of money of S600. c) an excess demand for money of $600. d) an excess demand for money of $200.Interest rate 2% 4 6 8 10 Transaction demand for money $220 220 220 220 220 Asset demand B) horizontal line. C) line sloping downward and to the right. D) line sloping upward and to the right. for money $300 280 260 240 220 Money supply $460 460 460 460 460 1. The transactions demand for money in the above market for money would graph as a: A) vertical line.
- 10. Mortgage rates and demand for housing - how interest rates affect demand for real estateInterest Rate (%) 2004 0 $75 150 225 Investment ($) Price Level Interest Rate (%) AS Q₁ Real GDP X Investment Demand 0 $50 100 150 Investment ($) -AD₂ (/=$100) AD3 (/=$50) Z AD₁ (/=$150) O Increase the money supply from $75 to $150 billion. O Increase the money supply from $150 to $225 billion. O Decrease the money supply from $225 to $150 billion. O Make no change in the money supply. Refer to the above diagrams, in which the numbers in parentheses near the AD1, AD2, and AD3 labels indicate the level of investment spending associated with each curve. All figures are in billions. The interest rate in the economy is 12 percent. What should the Fed do to achieve a noninflationary full-employment level of real GDP (Qf)?2.The Secretary of the Treasury was authorized by Congress to mint and sell a stated number of commemorative coins to raise funds to restore and renovate the Statue of Liberty. The U.S. Mint mailed advertising materials to persons, including Mary and Anthony Mesaros, that described the various types of coins that were to be issued. Payment could be made by check, credit card, or money order. Directly above the space provided on the order form for the customer’s signature was the following: “YES. Please accept my order for the U.S. Liberty Coins I have indicated. “ Mesaros forwarded to the Mint a credit card order for $1,675 for certain coins. Cash orders were processed before credit card orders. The 500,000 authorized coins were distributed before the Mesaros’ credit card order was able to be processed. The Mint notified the Mesaros that their order would not be filled. The coins increased in value 200% within the first few months after distribution. The Mesaros sued the U.S.…
- 15 - What happens to interest rates when prices fall?A) NoneB) increasesC) Remains FixedD) allE) DecreasesDollars 0 Quantity (4) € (3) (2) Refer to the diagram. Other things equal, an decrease of product price would be shown as A) a decrease in the steepness of curve (3), a downward shift in curve (2), and an downward shift in curve (1). B) an increase in the steepness of curve (3), an upward shift in curve (2), and an upward shift in curve (1). C) an upward shift in curve (2) only. D) a downward shift in curve (4) and an upward shift in curve (1), with no changes in curves (2) and (3).Describe some buyers and some sellers in the market for U.S. dollars.
- Terminal Activity PROBLEM SET Study and solve the given problems below. Show your complete solutions and label your answer. Write your ANSWER on your sheet. 1. Pamela makes a monthly salary of 27,900 pesos. She also receives an additional 9.5% commission rate bonus for any sales beyond 55,000 pesos. If Pamela sold 81,500 worth of merchandise this month, what is her total gross salary? 2. John is a realtor agent. He receives 5% commission when he sells a condo unit. How much commission will he receive for selling a condo unit that cost 3,500,000 pesos? 3. Randy was paid a commission of 8.5% on his total sales. If his sales were P13,000, P15,000, P25,000, P30,000, and 33, 000 pesos consecutively, find his gross earnings.If one's salary is $100k per year, the interest rate is 0.5 % (bank's rate), and the withdrawal cost is $300: money demand and withdrawal amount? If an individual can also buy perpetual bonds (either bond or having bank deposit, no other investment), what percentage should she keep in the bank (and buy bonds with the rest)? Explain (current year)5. Josh wants to save for his college education. He plans to make equal monthly deposits for four years. The savings account he has chosen will pay annual interest of 2% cornpounded monthly. (1 r): - 1 a. Use the future value formula F = I(1 + r)' + A ' + A ( ¹² + 1)² - ¹) t to write an algebraic rule that expresses ? the balance at the end of four years as a function of the amount Josh deposits each month. (initial deposit is $0.00) 48 F(48 months) = 0(1+.02) " + A((1+.02) .02 - 1) 48 Unit 4.1.1 → 4.1.4 (2 b. To which function family does this function belong? Explain your choice. c. Josh wants to have $5,000 at the end of the four years. Write an equation that could be used to determine how much Josh needs to save each month, solve the equation. then (find the monthly deposit needed if you start with =0)