The following figure shows the demand and supply curve for capital market. Find the price of capital, output of capital, depreciation value, net investment value and capital growth at the level of capital market equilibrium. Price of Capital SK SK + SK P1 P2 DK + dk P3 DK Pm Quantity of Сapital KI K2 K3 K4

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Q: “The result of the war that happened in Country A, it made Country A has negative public saving…

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Q: Low interest rates means low inflation which means depreciated currency. This stimulates businessmen…

A: Firstly, we need to understand the interest rate mechanism. When there is low inflation, it will be…

Q: Describe the difference between foreign direct investment and foreign portfolio investment. Who is…

A: The investment of foreign company or entity to a domestic company or entity is known as FDI (foreign…

Q: By which capital market is basically affected?

A: Capital Market is basically affected by two important factors.

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A: Investments are defined as the production of those goods and services that are used to produce other…

Q: Assume that in a small open economy where full employment always prevails, national saving is 500.…

A: Answer:- At the world interest rate, the investment would be 540

Q: The open-economy macroeconomic model includesa. only the market for loanable funds.b. only the…

A: Solution - We will evaluate the option - 1. Only the market for loanable funds -  It is the market…

Q: You are given the following information about an economy: Gross private domestic investment = 40…

A: GDP: GDP or gross domestic product is the estimation of the final value of all the goods and…

Q: In an open economy, why is the supply of loanable funds upward sloping?   a) A higher real interest…

A: In the loanable funds market, the supply of these funds are made by the consumers or households of…

Q: In the Model of Open Economy (Figure 1 below), use Saving (S), Investment (1). Net Export (NX), Net…

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Q: The following figure shows the demand and supply curve for capital market. Find the price of…

A: In the above figure, Sk represents the capital-goods . The function starts at Pm, or the lowest…

Q: In an open economy, the source of the demand for loanable funds is Group of answer choices

A: GIVEN In an open economy, the source of the demand for loanable funds is

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A: The quantity of foreign direct investment (FDI) in the United States has more than doubled in the…

Q: Explain why, in a small open economy, national saving can be less than investment. Use a…

A: Answer: A small open economy, is an economy which is open for lending and borrowing internationally.…

Q: Define Capital market.

A: The market is a location where the transaction of services and commodities takes place. It is…

Q: In your words describe and or explain the relation between savings and investment in an open market.…

A: Savings vary from investing in that money is frequently put into a bank savings account or a fixed…

Q: Question on Harrod-Domar Growth Model.  Show (complete mathematical solution) how the net savings…

A: Economic growth: When there is an increment in the generation of output is taking place then it will…

Q: Compare the impact of an increase in investment demand in a small open economy and a large open…

A:

Q: In the open-economy macroeconomic model, if the supply of loanable funds shifts right Group of…

A: In the loanable funds market, supply curve is upward sloping and funds sre supplied by households,…

Q: In an open economy, it is impossible to have national saving equal to domestic investment. Answer…

A: National Savings:- The proportion of remaining money which is not eaten or expended by the…

Q: Show the effects of an increase in the world interest rate on the market for loanable funds and the…

A: The market of loanable funds is base in the concept that the market interest rate is determined by…

Q: A decrease in the cash rate a. decreases the demand for loanable funds, lowers the real interest…

A: The volume-weighted average interest rate at which cash market transactions were settled is used to…

Q: What are foreign bonds? Explain the function of Global Capital Market.

A: A foreign bond is a bond given in a homegrown market by a foreign substance/entity in the homegrown…

Q: and owners. (1) able on the Johannesburg Stock (1).

A: Since you have posed various inquiry, we will settle the main inquiry for you. In the event that you…

Q: Discuss the role of budget surpluses and trade surpluses in national saving and investment

A: Budget surplus: When the income of the government exceeds their expenditure it is termed as Budget…

Q: “Is FDI a Good Sign for any country to Raise its capital” Justify the statement. Discuss the Reasons…

A: FDI is foreign direct investment.It is good sign for a country to increase its capital. With…

Q: Display graphically changes in the equilibrium interest rate if the economy is experiencing a…

A: A slowdown in economic growth is characterized by the reducing GDP growth rate and aggregate demand…

Q: Government stability and a well-functioning financial system are examples of what? Extractive…

A: Capitalism is an economic system where properties, trade and industries are controlled and owned by…

Q: If households from a small open economy expect future income to be lower than expected, then the…

A: The compensation that is being received by the workers or employees through fulfilling various types…

Q: The country of Cincinnatisland (country C) joins country B to form a large open economy, while…

A: f. At equilibrium level  Saving (S) = Investment (I) Given  SC = 50 + 200r  IA = 80 - 200r

Q: PART 1 Which of the following is NOT a part of the Global Capital Market?       a. The Eurocurrency…

A: A global capital market is the interlinking of various global investment exchanges for buying and…

Q: A country has a net foreign investment of $-5 Trillion? What does this mean?

A: Balance of Payment refers to the systematic record of all economic transactions between the…

Q: The People's Republic of China has an estimated $101.54 trillion of capital with a depreciation rate…

A: The contribution of capital is 0.4 and it would affect the GDP accordingly. The rise in capital…

Q: In an open economy, national saving equals domesticinvestmenta. plus the net outflow of capital…

A: An open economy is one that is open to trade with other economies. International trade refers to the…

Q: surplus imply the economic growth is strong? Please between level of GDP and Net capital outflow.

A: A trade deficit happens when a nation imports more than it sends out. Otherwise called a negative…

Q: The Tulu Island economy is experiencing an inflow of foreign investment capital associated with a…

A: A country is said to experience a trade surplus if the value of the goods and services it exports is…

Q: Multiple choice question In a small economy the difference between saving and investment…

A: An open economy is such an economy in which the equilibrium interest rate is the world interest…

Q: Explain the difference between foreign direct investment (FDI) and foreign portfolio investment…

A: Foreign portfolio investment can be defined as the securities and other financial assets passively…

Q: b. positive net capital outflow and negative net exports. c. negative net capital outflow and…

A: The GDP is the all out of all worth added made in an economy. The worth added implies the worth of…