Financial Math Answers

Assuming aggregate demand remains constant, supply shocks that cause a leftward shift in the aggregate supply curve will------.

Select one:

a. increase both prices and the rate of unemployment

b. decrease the rate of unemployment

c. increase real output

d. decrease prices

n the AS/AD model, an expansionary monetary policy---------.

Select one:

a. reduces aggregate demand by reducing interest rates

b. reduces aggregate demand by raising interest rates

c. increases aggregate demand by raising interest rates

d. increases aggregate demand by reducing interest rates

Which of the following statements are correct?

a. If the marginal propensity to consume increases, the equilibrium level of income will increase.

b. In an open economy with a government sector the sum of the marginal propensity to consume and the marginal propensity to save is always equal to 1.

c. If the tax rate decreases, the aggregate spending curve will shift parallel upwards.

Select one:

A. b

B. b and c

C. a and b

D. a and c

Which of the following statements are correct?

1. The introduction of government spending increases the size of the multiplier.
2. The introduction of taxes increases the size of the multiplier.
3. The introduction of taxes reduces the slope of the consumption function.

Select one:

A. None of the statements is correct.

B. A

C. B

D. C

Investment decisions cannot be affected by

Select one:

a. Expected rate of return

b. Cost of capital goods

c. Interest rate

d. None of the options are correct

One of the following cannot be considered as a factor that affect consumption

Select one:

a. None of the options are correct

b. Interest rates

c. Wealth

d. Price expectations

Total spending in the Keynesian model of a closed economy without government includes

Select one:

a. Imports and government spending

b. Consumption and Imports

c. Investment and government spending

d. Consumption and investment

Centuries ago, rich families in the province of friesland established a fund to further welfare and education.from this fund,only the interest revenue was allowed to be spent in order to keep principal amount unattached .assume the fund has amounted to R12 million and market interest rate is 6%annually .what could be the perpetuity (or present value of the fund ) endowed to the society?

You have a choice when subscribing toour magazine:you can

(i) pay R100 now for a next four year subscription,

(ii) pay R28 at the beginning of each month for four years,or

(iii) pay R54 today and R54 again two years from today.

Which one is the best deal for you,the subscribers,if your opportunity cost of funds is 10%?

Susan Bertrees can invest $12,000 at 2% interest compounded twice a year or compounded quarterly. If either investment is for 5 years, which investment results in more interest? How much more interest is yielded by the better investment?