Economics Answers

Canada produces natural resources (coal, natural gas, and others), the demand for which has increased rapidly as China and other emerging economies expand.

1. Explain how growth in the demand for Canada’s natural resources would affect the demand for Canadian dollars in the foreign exchange market.
2. Explain how the supply of Canadian dollars would change.
3. Explain how the value of the Canadian dollar would change.
4. Illustrate your answer with a graphical analysis.

Suppose that yesterday the Canadian dollar was trading on the foreign exchange market at 0.75 euros per Canadian dollar and today the Canadian dollar is trading at 0.80 euros per Canadian dollar. Which of the two currencies (the Canadian dollar or the euro) has appreciated and which has depreciated today?

Colombia is the world’s biggest producer of roses. The global demand for roses increases and at the same time Colombia’s central bank increases the interest rate. In the foreign exchange market for Colombian pesos, what happens to:

1. The demand for pesos?
2. The supply of pesos?
3. The quantity of pesos demanded?
4. The quantity of pesos supplied?
5. The peso-Canadian dollar exchange rate?

Banks in New Transylvania have a desired reserve ratio of 10 percent of deposits and no excess reserves. The currency drain ratio is 50 percent of deposits. Now suppose that the central bank increases the monetary base by $1,200 billion.

1. How much do the banks lend in the first round of the money creation process?
2. How much of the initial amount loaned flows back to the banking system as new
3. deposits?
4. How much of the initial amount loaned does not return to the banks but is held
5. as currency?
6. Why does a second round of lending occur?
7. Calculate money multiplier in this example?
8. What is the final increase in the quantity of money?

What is the cardinality of the relationship between an event (such as a sale) and the store in which that event happened?

A. 1:1

B. 0:N

C. M:N

D. 1:N

Where would information (i.e., address, size, acquisition date, etc.) about a specific retail store in a chain (e.g., the store in Tempe, Arizona) be stored?

A. In a relationship entity

B. In a resource entity

C. In one or more agent entities

D. In one or more event entities

How can an REA diagram show that a team of employees is involved in performing an event—recognizing that the number of employees participating varies for different instances of the event (e.g., one row in the event table might be linked to 3 employees, another row linked to only 2 employees, and so on)?

A. By using foreign keys in the event entity

B. By linking the event to multiple different employee entities

C. By using primary keys in the event entity

D. By creating an M:N relationship between the employee and event entities

Two types of locations entities (Warehouses and Financial Institutions). What other location entities might be found in the REA diagrams for different types of companies? Why?

Explain why standard prices and costs are recorded in resource entities, but actual prices and costs are recorded in event entities.

The ultimate goal of Accounting Information System is to use relational database technologies to record and store data by digitizing business transactions and business policies. Based on the give-to-get economic duality, the REA theory demonstrates that Resource, Event, and Agent can conceptualize all business processes and policies. The cardinalities of ER (entity-relationship) guides how to develop the relationship between two tables. the approach to developing an REA diagram for each business cycle and integrating REA diagrams across cycles. 

The differences between merging redundant resources and merging redundant events in the integration. 3 sentences to explain the differences?

Can we directly link two entities (tables) if they have a Many-to-many relationship? If not, how to solve this issue?

Does the AIS database directly store Accounts Payable data? If not, how can we acquire this information for the financial report?