Suppose one-year US Treasury bill pays 2.25% and one-year Canadian Treasury bill pays 1.04%. The current spot exchange rate is 1 US dollar (USD) = 1.2897 Canadian dollar (CAD) and the one-year forward exchange rate is 1 USD = 1.2293 CAD. How much arbitrage profit can an investor earn on an investment value of CAD 1 million? Answer:

Answers

Answer 1

Arbitrage is a trading strategy that involves exploiting a price differential between two markets for the same good. The strategy is intended to benefit from market inefficiencies and generate risk-free returns.

Suppose an investor is seeking to earn profits through arbitrage on an investment value of CAD 1 million. The investor may invest in one of the treasury bills based on the current and forward exchange rates. The calculation of the arbitrage profit can be done as follows:

1. Invest in a US treasury bill and convert CAD 1 million to USD. At the current spot exchange rate, CAD 1 million = $776,944.992. Invest $776,944.99 in US treasury bills for one year at a 2.25% interest rate. The future value of the investment after one year will be:$776,944.99 + $776,944.99 × 2.25% = $794,959.633. Convert the future value of the investment from USD to CAD at the one-year forward exchange rate.

2. At the one-year forward exchange rate, $794,959.63 = CAD 975,000.00The arbitrage profit is calculated as follows: Arbitrage profit = Investment at a one-year forward rate - Investment at current spot rate= CAD 975,000.00 - CAD 1,000,000.00= -CAD 25,000.00Therefore, the arbitrage profit that the investor can earn on an investment value of CAD 1 million is CAD 25,000.00.

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Related Questions

How is the excel sheet suppose to look? How many sheet is there? Can you do it but this time showing just the excel document with the sheet(s) included along with the steps in the sheets?

Answers

In an Excel sheet, data is organized into rows and columns and sheets are used to keep track of different sets of data within a workbook. A workbook can contain several sheets, each of which has its own set of columns and rows. An Excel sheet is used to store numerical data, graphs, and text.

Here's how to create an Excel sheet with two sheets and steps in each sheet:

1. Open Microsoft Excel on your computer.

2. Click on the File tab, select New, and then click Blank workbook.

3. Rename Sheet 1 to Sales and Sheet 2 to Inventory by double-clicking on the Sheet tab.

4. In the Sales sheet, add the following headers in row 1: Sales Date, Product, Price, Quantity, and Total. In the next row, enter sample data for each column.

5. In the Inventory sheet, add the following headers in row 1: Product, Category, Quantity, and Price. In the next row, enter sample data for each column.

6. To switch between sheets, click on the Sheet tab at the bottom left corner of the screen and select the sheet you want to view.

7. You can now enter data in each sheet and use Excel's built-in functions to analyze your data.

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According to the video, in which areas are Accountants and Auditors involved? Select four options. budgeting hiring training planning cost control employee compensation event planning

Answers

Answer: budgeting

planning

cost control

employee compensation

Explanation:

The areas that accountants and auditors are involved in in an organization include the budgeting, planning, cost control and employee compensation.

We should note that the accountant and the auditors are involved in the financial aspect of the company, hence, the reason for the options chosen.

Hiring and training is the function of the human resource department.

Answer: 1, 4, 5, and 6

1.) budgeting

4.) planning

5.) cost control

6.) employee compensation

Explanation: i hope this helps :)

Why postal service is important for business​

Answers

Explanation:

It is important for businesses for several reasons:

1 Communication: Postal service is a reliable and affordable way for businesses to communicate with customers and other businesses. It enables businesses to send and receive important documents, such as contracts, invoices, and legal notices, which are necessary for their operations.

2 Marketing: Postal service is an effective tool for businesses to reach out to potential customers and promote their products and services. Direct mail campaigns can target specific audiences and help businesses generate leads and sales.

3 Logistics: Postal service is an essential component of supply chain management. It enables businesses to send and receive goods and materials from suppliers and customers, which is crucial for their operations.

4 E-commerce: Postal service plays a vital role in the growth of e-commerce. It enables businesses to deliver products to customers who shop online, which is becoming an increasingly important part of the retail industry.

5 Accessibility: Postal service is often the most accessible and convenient way for businesses in remote or rural areas to connect with the rest of the world. It provides them with access to markets and customers that would otherwise be difficult to reach.

Yasmine plans to attend a four-year public university. She expects she will need to contribute $9,000 annually to her education. Which savings plan will help Yasmine save enough money to pay for one year of school, regardless of whether or not interest is earned on her savings? $600 per month for 1 year $350 per month for 2 years $225 per month for 3 years $200 per month for 4 years

Answers

Answer:

It be D: $200 per month for 4 years is the correct answer.

Explanation:

$9,000/200= 45 months = 4years

4. list two arguments that president kennedy present to convince his audience of the need to participate in space exploration.

Answers

President Kennedy presented three main arguments to convince his audience of the need to participate in space exploration. Firstly, he argued that space exploration was important for national security. He pointed out that the Soviet Union was already making strides in space exploration, and if the United States didn't invest in the same area, then they risked falling behind and losing their dominance in the world.

Secondly, President Kennedy argued that space exploration was important for scientific progress. He noted that space exploration could help scientists better understand the universe and how it worked. He also emphasized that the United States could use space exploration to develop new technologies that could be beneficial to society. Finally, President Kennedy argued that space exploration was important for the future of humanity. He emphasized that space exploration could help pave the way for human colonization of other planets, which could be critical in case of an emergency or a catastrophic event on Earth.

In conclusion, President Kennedy presented compelling arguments to convince his audience of the need to participate in space exploration. He highlighted national security, scientific progress, and the future of humanity as the three main reasons why the United States should invest in space exploration.

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When should a person proceed with a
choice in terms of marginal benefits
and cost?
O when the market is high

O when there is no difference

O when the benefits outweigh the
cost

Answers

Answer:

when the difference outweighs the cost

by what action does the federal reserve trt to control inflation​

Answers

Answer: Monetary Policy

Explanation:

The Fed controls inflation through monetary policy whereby it either increases the supply of money in the economy or it decreases it. The logic being that when there is more money in the economy, people will be able to buy more goods and services which would lead to a rise in prices as demand pulls up inflation rates.

The reverse holds true.

The Fed uses tools such as Open market operations and adjusting the reserve requirement to accomplish monetary policy.  

If the goal is to increase money supply, the Fed embarks on Open market operations where it buys securities(paying the public puts money into the economy) from the public as well as reducing the reserve requirement which increases the amounts that banks can loan out.

To reduce money supply the Fed sells securities and increases the reserve requirement. There are other tools for monetary police but the basic premise is the same; they are used to either increase or decrease money supply.

Why does the quantity of salt demanded tend tobe un responsive to changes in its price

Answers

The quantity of salt demanded tend tobe un responsive to changes in its price because salt is an inelastic good, the quantity demanded is unresponsive to price changes. This means that regardless of the price change, people will still buy it.

Salt is a product with a limited number of substitutes, and people may not spend a lot of money on it, so price increases do not bother them. Furthermore, it is a necessity with no close substitutes.

Thus, the demand for salt is inelastic i.e. any change in its price will not affect demand.

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This week we look more closely at the systems theory and organizational structure. Organizations can be either flat or steep - and that's not referring to the building they are housed in? - A flat organization is one where there aren't many opportunities to move up - there's one manager over several positions, and there's not much above that person. - A steep organizational chart is one where there is a hierarchy. Your boss reports to someone who reports to someone, and there are a few more layers before the President of the company Food Service companies have that as well. IN A GENERAL SENSE... Sodexo is a 'steep' company, while Compass Canada and Marquise are much 'flatter'. Both have positives and negatives associated with their structure. What would you expect are these positives and negatives? What have you experienced?

Answers

Organizational structure refers to how an organization's activities are organized and coordinated. This involves management of activities and delegation of tasks to employees.

There are different types of organizational structures:

Flat organizations: Organizations with few or no levels of middle management between staff and executives. Generally, flat organizations have a wider span of control, with executives having a larger number of direct reports. This implies that employees are responsible for more duties, while executives may interact with employees more often.

Steep organizational charts: Organizations with many levels of middle management between staff and executives. Steep organizations have a narrow span of control, which means that executives have a smaller number of direct reports and are responsible for fewer tasks.

The benefits and drawbacks of flat and steep organizational charts are as follows:

Flat organizations have a number of advantages:

They promote teamwork and collaboration among employees and departments.

They provide employees with greater autonomy and responsibility, which can lead to increased job satisfaction.

They promote communication between executives and employees, which can lead to a better understanding of the organization's goals and objectives.

They can operate more efficiently and flexibly than hierarchical organizations because there are fewer layers of management.

Steep organizations have a number of advantages:

They promote specialization and expertise among employees, which can lead to higher productivity and quality.

They provide clear lines of authority and accountability, which can facilitate decision-making and reduce conflict.

They promote career development and opportunities for advancement, which can lead to increased motivation and loyalty.

They can be more effective than flat organizations in larger, more complex organizations because they require more formal coordination and control.

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Question 13 Which of the following scenarios depicts intellectual stimulation? O Jane knows her team well, and assigns work based on their different skills and experience levels O Jane's team knows sh

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Intellectual stimulation is described as the practice of encouraging creative thinking and creative problem-solving abilities among the members of a team by challenging and stretching them beyond their current skill level.

Jane's team receives assignments that demand them to learn new skills, technologies and explore fresh ideas and opportunities. A scenario in which employees are encouraged to develop their creativity, critical thinking, and problem-solving abilities is called intellectual stimulation. Intellectual stimulation is frequently used in the business setting to motivate and engage personnel, as well as to encourage a culture of innovation.

By doing so, the team members are empowered and stimulated, allowing them to develop their critical thinking, creativity, and problem-solving skills, which can help them in future job endeavors. In conclusion, intellectual stimulation is necessary to encourage employees to work hard and continuously improve their abilities while also being creative and innovative.

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which beverage is sold with the slogan "made from the best stuff on earth" on its bottle

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The beverage sold with the slogan "made from the best stuff on earth" is Snapple.

Snapple is a popular brand of tea and juice drinks that was first introduced in the United States in 1972. The slogan "made from the best stuff on earth" is featured on its bottle labels to emphasize the quality and natural ingredients used in their beverages.

Snapple prides itself on using real fruit juices, natural flavors, and high-quality tea leaves to create a variety of refreshing and delicious drinks. The slogan also helps differentiate Snapple from other beverage brands by suggesting a superior taste and commitment to quality.

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Mistakes made frequently when managing current cash needs include:
1. Overspending as a result of impulse buying & overusing credit
2. Having insufficient liquid assets to pay current bills
3. Using savings or borrowing money to pay for current expenses
4. Failing to put unneeded funds in an interest-earning savings account or investment plan

Answers

Managing current cash needs is an integral part of any individual or organization. In business, poor cash management can result in dire consequences, such as missed payments, fees, and penalties, damage to credit ratings, and ultimately bankruptcy.

Likewise, overspending can lead to cash flow problems in one's personal life and affect one's ability to pay current bills, resulting in financial strain, stress, and even debt. Common mistakes made frequently when managing current cash needs include overspending, insufficient liquid assets, using savings or borrowing money to pay for current expenses, and failing to put unneeded funds in an interest-earning savings account or investment plan.

The first mistake is overspending as a result of impulse buying and overusing credit. Overspending is a common problem for many people. Impulse buying and overusing credit are two of the main culprits behind overspending. Impulse buying occurs when people make unplanned purchases due to their emotions, often triggered by sales, promotions, or peer pressure.

Overusing credit is when people borrow money or use credit cards to finance purchases they cannot afford. When people overspend, they often do not have enough money left over to pay for other bills or emergencies, resulting in a cash flow problem.

The second mistake is having insufficient liquid assets to pay current bills. Insufficient liquid assets mean that people do not have enough cash or easily accessible funds to pay for their bills. This can result in missed payments, late fees, and penalties, which can add up quickly and cause significant financial damage over time.

The third mistake is using savings or borrowing money to pay for current expenses. Using savings or borrowing money to pay for current expenses is not a sustainable practice. It can lead to a depletion of savings and an increase in debt, making it difficult to manage cash needs in the future. Instead, it is recommended to set up a budget, prioritize expenses, and save for emergencies.

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Treasury spot interest rates are as follows: Maturity (years) 1 2 3 4 Spot rate (EAR) 1.4% 2.8% 3.6% 4.5% What is the price of a risk-free zero-coupon bond with 3 years to maturity and a face value of $1,000 (in $)? (answer,0+ decimals)

Answers

Answer: $868

Explanation:

Given the following :

Maturity (years) - - - - - - 1 - - 2 - - - 3 - - - 4

Spot rate (EAR) - - - - 1.4% - 2.8% - 3.6% - - 4.5%

What is the price of a risk-free zero-coupon bond with 3 years to maturity and a face value of $1,000 (in $)?

Face value / ( 1 + spot rate)^p+1

Where P = year

=1000/(1+3.6%)^4

1000 / ( 1 + 0.036)^4

1000/(1.036)^4

1000/1.151964303616

=$868.08245

mention 5 types of unemployment

Answers

Seasonal, Frictional, Structural, Cyclical, Technological

The percentage change in prices over time. This is a key indicator of the cost of
O Growth
O Recession
O Inflation Rate
O Unemployment Rate

Answers

ANSWER: Inflation Rate


I would say the third one

Select all that apply.

Learning styles include all of the following:


bodily/kinesthetic

verbal/linguistic

naturalistic

personal

Answers

Answer:

bodily/kinesthetic

verbal/linguistic

Explanation:

Learning styles can be regarded as range of competing as well as contested theories which analyse

differences that exist learning of in individuals. It should be noted that the Learning styles includes

✓bodily/kinesthetic

✓verbal/linguistic

Answer:

verbal/linguistic

bodily/kinesthetic

naturalistic

Explanation:

checked answer on Odyssey

All of the following are methods of evaluating the risk of a project except multiple choice the net present value profile a monte carlo simulation decision trees the coefficient of variation

Answers

The answer choice that is NOT a method of evaluating the risk of a project is its B. Profile

What is Risk Management?

This refers to the identification of risk in any venture and the evaluation of the response to risk factors.

Hence, we can see that when a person is evaluating the risk of a project, he would have to check the net present value, the coefficient of variation, etc, but the evaluation of the profile is not a method of risk evaluation of the project.

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According to the video, what are some qualities needed by Computer Support Specialists? Check all that apply.

physical strength and fitness
graphic design skills
patience and understanding
knowledge of computers and software
verbal and written communication skills
marketing and sales skills

Answers

Answer:

patience and understanding

knowledge of computers and software

verbal and written communication skills

Explanation:

Just answered it on edge

Some qualities needed by Computer Support Specialists are as follows:

patience and understandingknowledge of computers and softwareverbal and written communication skills

So, the correct options are C, D and E.

Who are Computer Support Specialists?

A computer support specialist is also commonly known as an IT specialist, network technician, tech support specialist, or network specialist. Computer support specialists refer to those providing assistance and guidance to individuals or organizations that are using computer software or equipment are new-age professionals also known as computer network support specialists.

Their job is to support the information technology employees working in their organization. Computer support specialists are assigned a variety of responsibilities that differ depending on whether they provide network or direct user support.

Therefore, the correct options are C, D and E.

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which of the following is not an example of a performance obligation? a.performing contractually agreed-upon tasks b.granting a right to use a tangible asset c.arranging for another party to transfer goods or services d.transferring produced goods or reselling purchased goods

Answers

The statement that is not an example of a performance obligation is option (d) transferring produced goods or reselling purchased goods.

A performance obligation is a promise in a contract with a customer to transfer goods or services that are distinct and capable of being distinct. It is an obligation that a company has to perform a task, provide a service, or deliver a product.

Options a, b, and c all describe examples of performance obligations

a. Performing contractually agreed-upon tasks is a performance obligation because it involves a promise to do something for the customer.

b. Granting a right to use a tangible asset is a performance obligation because it involves transferring a right to use something to the customer.

c. Arranging for another party to transfer goods or services is a performance obligation because it involves facilitating the transfer of goods or services to the customer.

Option d, transferring produced goods or reselling purchased goods, is not a performance obligation because it does not involve a promise to transfer distinct goods or services to the customer. Rather, it involves the transfer of ownership of a good that has already been produced or purchased.

Therefore, the correct option is (d) transferring produced goods or reselling purchased goods.

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Oscar has an policy with a $200 premiumIn April he is in an accident and has bill totaling $8,500His deductible is $1,500 with a coverage limit of $5,000How much will Oscar have to pay in the month of April?

Answers

Oscar has insurance with a $200 deductible. He is in an accident in April and has an $8,500 charge. His deductible is $1,500, and he has a $5,000 coverage cap. As a result, Oscar will have to pay $3,500 in April.

What exactly is a coverage cap?

A coverage cap is a limit on the amount that an insurance policy will pay for a particular benefit or service. This means that the insurance policy will only pay up to a certain amount, and any costs that exceed that limit will be the responsibility of the policyholder.

Coverage caps are often used in health insurance policies, where there may be limits on the amount that the policy will pay for certain types of medical procedures or treatments. For example, a policy may have a coverage cap of $10,000 for a specific type of surgery. If the cost of the surgery exceeds $10,000, the policyholder will be responsible for paying the difference.

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one company is facing several decisions regarding investing and financing activities. address each decision independently. on june 30, 2024, the stone company purchased equipment from paper corporation. stone agreed to pay $15,000 on the purchase date and the balance in six annual installments of $7,000 on each june 30 beginning june 30, 2025. assuming that an interest rate of 12% properly reflects the time value of money in this situation, at what amount should stone value the equipment? stone needs to accumulate sufficient funds to pay a $450,000 debt that comes due on december 31, 2029. the company will accumulate the funds by making five equal annual deposits to an account paying 5% interest compounded annually. determine the required annual deposit if the first deposit is made on december 31, 2024. on january 1, 2024, stone leased an office building. terms of the lease require stone to make 20 annual lease payments of $125,000 beginning on january 1, 2024. a 12% interest rate is implicit in the lease agreement. at what amount should stone record the lease liability on january 1, 2024, before any lease payments are made?

Answers

$1,109,479.93 amount should stone record the lease liability on january 1, 2024, before any lease payments are made which means Present Value of Lease Liability is $1,109,479.93

Requirement 1

Equipment should be recorded at its Cash Price Equivalent. But in the absence of such, it is recorded at the present value of payments or fair value at the time of acquisition, whichever is lower.

Since Cash Price Equivalent and fair value is not available, we will use the discounted value of payments.

Annual Payments = $6,000

PV of 11% ordinary annuity for 6 periods = 4.23054

Present Value of Annual Payments = $6,000 x 4.23054 = $25,383.24

Add: Down Payment - $29,000

Present Value of Equipment = $54,383.24

Requirement 2

Future Value of Debt = $590,000

Future Value factor of 6% for 5 periods = 5.63709

Required Annual Deposits = $590,000 / 5.63709 = $104,663.93

To raise a total of $590,000, Johnstone should invest $104,663.93 annually to pay off its debt due in December 31, 2021.

Requirement 3

Lease liability are recorded at the present value of the total minimum lease payments.

Annual Payment = $139,000

Present Value factor of 11% annuity due for 15 periods = 7.98187

We use annuity due because the payments are made in advance.

Present Value of Lease Liability = $139,000 x 7.98187 = $1,109,479.93

Lease liability is recorded at its present value. An interest expense is also recognized annually for the whole life of lease.

Investments are monetary resources purchased in order to earn returns in the future or to be sold in the future for profit. The higher the investment, the higher the return is. But it also means higher risk.

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the benefit a new product offers over existing substitutes is called ___________.

Answers

The benefit a new product offers over existing substitutes is called competitive advantage.

Competitive advantage refers to the unique advantage a product or service has over its competitors in terms of quality, price, features, or other factors. A product's competitive advantage can be the result of innovative technology, superior design, efficient manufacturing, or effective marketing.

A company with a strong competitive advantage can differentiate itself from its competitors and attract more customers. In today's highly competitive business environment, companies must constantly strive to maintain and enhance their competitive advantage by investing in research and development, improving operational efficiencies, and creating customer value.

By doing so, companies can stay ahead of their competition and ensure long-term success in the market.

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Active listening is a process of communication in which the listener engages the speaker by repeating or rephrasing the speaker’s words; the listener may also mirror body language or _____.

apathetic behavior
tone of voice
nervous tics
hand gestures

Answers

Answer: tone of voice

Explanation:

Active listening refers to a process of communication whereby the speaker is engaged by the listener who repeats the words or statements heard.

Active listening involves the individual listening with all his or her senses and giving the speaker all the attention needed.

In active listening, the listener can mirror the body language or the tone of voice of the speaker. Active listening can be either acquired or developed through constant practice.

You see Paul dealing with Susan, an upset employee from another department. Susan is complaining about something that your department was supposed to do but didn't. You are in a back room and have not been seen by Susan. Paul is obviously frustrated and unable to deal with Susan effectively. You should:

a. Walk up to the pair and attempt to change the conversation.
b. Introduce yourself to Susan and offer your assistance.
c. Ask your supervisor to offer some interpersonal skills training to Paul.
d. Tell Paul that Susan is needed by the supervisor to end the situation.

Answers

I think option (b) is the correct

The COVID-19 pandemic forced many people to switch to
a remote workplace. How did this change affect job satisfaction?
What do you think will happen as employees return to in-person work
environments?

Answers

The switch to remote work during the COVID-19 pandemic had both positive and negative impacts on job satisfaction.

How did the transition to remote work affect job satisfaction during the COVID-19 pandemic?

The shift to remote work brought significant changes to the work environment and had varied effects on job satisfaction. For some individuals, the flexibility and autonomy of working from home enhanced their satisfaction. They appreciated the elimination of commuting time, increased work-life balance, and the ability to customize their workspaces. However, others faced challenges such as blurred boundaries between work and personal life, decreased social interaction, and potential feelings of isolation.

As employees return to in-person work environments, there will likely be a mixed response. While some may embrace the return to face-to-face interactions, collaborative work, and a structured office environment, others may miss the freedom and flexibility of remote work. The future of job satisfaction will depend on how organizations address the evolving needs and preferences of their employees, striking a balance between in-person and remote work options to create a positive and productive work environment.

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When will the Mini Toolbar appear?

when you type text
when you press the Delete key
when you select text
when you first open a file

Answers

Answer:

It is C on edge 2021

Explanation:

Answer:

(c) when you select text

Explanation:

The tool bar appears when you select text to provideoptions depending on what you would like to do with the text.

Corporate bylaws: A. must be amended should a firm decide to increase the number of shares authorized. B. cannot be amended once adopted. C. define the name by which the firm will operate. D. describe the intended life and purpose of the organization. E. determine how a corporation regulates itself.

Answers

Answer:

Option "E" is the correct answer to the following question.

Explanation:

Corporate bylaws or Laws are special rules or regulations made by a company which is a set of statutory laws used by the Board of Directors. Corporate rules or regulations are important legal documents that ensure how a manager will run a corporate website and all the rules and regulations related to it are written.

Corporate bylaws or Laws are used to run corporations easily and smoothly.

how are resources and scarcity connected?

Answers

Answer:

Explanation:

resources and scarcity are connected.

HOW?????

If we do not have resources, it leads to scarcity.

For example, If we do not have water which is a very precious resource, it leads to scarcity of water.

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What are the effects of an increase in labor productivity on potential GDP, the
quantity of labor, the real wage rate, and potential GDP per hour of labor?

Answers

An increase in labor productivity can lead to an increase in potential GDP, as it allows more output to be produced with the same amount of labor.

What are the effects of an increase in labor productivity on potential GDP, the quantity of labor, the real wage rate, and potential GDP per hour of labor?

An increase in labor productivity can lead to an increase in potential GDP, as it allows more output to be produced with the same amount of labor.

However, the effect on the quantity of labor and real wage rate is less clear-cut. In some cases, an increase in productivity can lead to an increase in the demand for labor and therefore higher wages. In other cases, it can lead to a decrease in demand for labor and lower wages. Ultimately, the effect on potential GDP per hour of labor will depend on the relative changes in output and labor inputs.

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If the next chair of the Federal Reserve Board has a reputation for advocating an even slower rate of money growth than the current​ chair, what will happen to interest​ rates? A. Slower money growth will lead to a liquidity​ effect, which will lower interest rates.​ Moreover, the lower​ income, price​ level, and inflation will reinforce the decrease in interest rates. B. Slower money growth will lead to a liquidity​ effect, which will raise interest​ rates; however, the lower​ income, price​ level, and inflation will tend to lower interest rates. C. Slower money growth will lead to a liquidity​ effect, which will lower interest​ rates; however, the lower​ income, price​ level, and inflation will tend to raise interest rates. D. Slower money growth will lead to a liquidity​ effect, which will raise interest rates.​ Moreover, the lower​ income, price​ level, and inflation will reinforce the increase in interest rates.

Answers

Answer: B. Slower money growth will lead to a liquidity​ effect, which will raise interest​ rates; however, the lower​ income, price​ level, and inflation will tend to lower interest rates.

Explanation:

Slower money growth would mean there is less money in the economy which means that there is less liquidity. This will increase interest rates because there would be less money available to loan out to people and so the ones that will be available have to be done at high rates.

As a result of the lower money supply though, people would have lower incomes and demand less goods which would reduce the price level. These will have the effect of reducing the rates to enable people get loans.

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