Money Market: SR vs LR (i) What is the official cash rate? (ii) How can the RBNZ manipulate the short-term money market interest rate using the OCR tool? (iii) Why do they have difficulty in manipulating the long-term fixed rate?
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- Q 181.1. A decline in money purchasing power. Annual inflation was 7%. The percentage of money decreased purchasing power? Task 1.2. How will the purchasing power of money change during the year if there is a constant inflation rate of 1.5% in the quarter? 1.3. The bank pays a constant simple percentage of 10% a year. What amount should be invested in a bank account in order to accrue EUR 1000 after 4 years? 1.4. Holding period yield HPR holding period return. The deposit certificate was purchased 7 months before the maturity of 1000 euro and sold 2 months before the maturity date of the deletion of EUR 1200. What is the profitability of this financial operation for annual fruit in the form of a rate? Objective 1.5. How much money needs to be invested today in a bank that pays 12% a year and capitalizes fruit every quarter to get £1,000 after 6 years? 1.6. The bank is offering 18% a year, inflation is 15% a year. What is the real fruit rate? 1.7. EUR 1500 is invested in the bank account.…Please explain each step in detail
- a) Assume that the nominal return on U.S. government T-bills was 10% during 2002, when the rate of inflation was 6%. The real risk-free rate of return on theseT-bills was: b) When individuals believe they have sufficient income and assets to cover their expenses while maintaining a reserve for uncertainties, they are most likely in the phase of the investment life cycle. gifting B. consolidation C. accumulation D. spending c) Find the duration of a 3-year bond with annual coupon payments of $80 and a par value of $1,000. The current market price of the bond is $950.25. If the YTM of the bond dropped by 1%, what would happen to the bond price?Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.In the quantity equation, MV = PY, if velocity is constant, real GDP is growing at 2% per year, and the money supply is increasing at 7% per year, what will inflation be in the long run? Select one: a. 4% per year b. 6% per year c. 7% per year d. 5% per year
- Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.Ifr- 15%: Currency in circulation= 500 billion S; Checkable deposits 1000 billion $; and excess reserves 10 billion 5; then the money multiplier is equal to. A. 0.70 OB. 0.80 OC. 0.90 D. none of the aboveInterest Rate 0 Sm m Q Quantity of Money Refer to the diagram of the market for money. Given Dm and Sm, an interest rate of i3 is not sustainable because the: O demand for bonds in the bond market will decline and the interest rate will rise. O supply of bonds in the bond market will decline and the interest rate will rise. O supply of bonds in the bond market will increase and the interest rate will decline. O demand for bonds in the bond market will rise and the interest rate will fall.
- \\Assumes that commercial banks have a 20% fixed liquidity ratio. When Mr. Farhan Yaseen deposits PKR 1000 into a Bank. By the credit creation process, what is the maximum amount of loans that the banks can create? required calculation in the papersuppose the diffrence between the transaction velocity and the income velocity of circulation of money in an economy is a 5 and the money value of total transaction 6 times the money value of aggregate income . if the quantity of money in circulation is 1000 currency unit , then the money value of aggregate income in currency unit is (a)1000 (b)1200 (c)1500 (D)1800Q36 The LM curve is flatter if the interest elasticity of demand for money- Select one: a. both may be possible b. none of the given options c. high d. low
