Show effect this would have on interest rates, bond prices

Assignment Help Microeconomics
Reference no: EM13957488

For each of the following situations graph the supply and demand curves for the loan market, for the bond market and show the primary movement in the curves as a result of the given action. Show the effect this would have on interest rates, bond prices, quantity of loans and quantity of bonds?

a) The government increases the corporate tax rate, which decreases the return on new business investments.

b) The new US Congress and the president come to an agreement on a bill to increase the debt ceiling, thus reducing the risk of a government debt default.

c) The recent financial crisis and recession makes Americans more skeptical of debt and increases the national savings rate, and generally more conscious of the need to think about the future.

d) A first time home buyer tax credit make is affordable for more families to purchase a house.

e) Federal spending increases leading to a larger federal deficit.

f) Federal Reserve chairman announces in a press conference that he will implement a new anti-inflation program and the financial markets believe that he will follow through on this promise. Excel Problem: For this problem, you must calculate your answer using excel and upload the spreadsheet.

Reference no: EM13957488

Questions Cloud

Disheveled and appears homeless : You are working a second job at Publix, a large grocery store. While on duty, you witness someone steal food right in front of you. The person is disheveled and appears homeless. She has a young child with her. Do you turn her in for the theft?
What are the important aspects of an improvement plan : Name and describe three best practices for a performance evaluation system. Use at least one reference to support your remarks. What are the important aspects of an improvement plan? Why are these so important?
What are the three domains of ict impact : What will happen if Technical Requirements for the Market of resources are not met? What is ICT, also mention some example? Discuss the importance of ICT in industry. What are the three domains of ICT impact? How has ICT impacted modern virtual enter..
How about the attitude of altria : Would you describe the orientation of Reynolds toward tobacco regulation as cooperative or at arm's length? How about the attitude of Altria? What do you think explains the differences between the two companies' positions
Show effect this would have on interest rates, bond prices : For each of the following situations graph the supply and demand curves for the loan market, for the bond market and show the primary movement in the curves as a result of the given action. Show the effect this would have on interest rates, bond p..
Detailing the process capability index : Your manager hands you a list detailing the process capability index, Cp, for machines A, B, and C. These values are 1.78, 0.97, and 0.53 respectively. Of these machines, which if any, are producing products within allowable specifications?
Corporation natural and societal environments : Discuss how a development in a corporation’s natural and societal environments can affect the corporation through its task environment. How can value chain analysis help identify a company’s strengths and weaknesses? What are the advantages and disad..
What is the optimal replenishment order up to level : Honeywell and Cootes law firm still uses pens and paper regularly rather than being a technology enabled company. They estimate that they use 8,000 high quality pens a year with a daily standard deviation of 10 pens. These high quality pens costs rou..
What is the probability that a defective unit is shipped : Line Consider an assembly line with 20 stations. Each station has a 0.5% probability of making a defect. At the end of the line, an inspection step singles out the defective units. The inspection step catches 80% of all defects. What is the probabili..

Reviews

Write a Review

Microeconomics Questions & Answers

  The free rider problem

Question: Explain why the free rider problem makes it difficult for perfectly competitive markets to provide the Pareto efficient level of a public good.

  Failure of the super committee is good thing for economy

Some commentators have argued that the failure of the “Super committee” is good thing for the economy?  Do you agree?

  Case study analysis about optimum resource allocation

Case study analysis about optimum resource allocation: -  Why might you suspect (even without evidence) that the economy might not be able to produce all the schools and clinics the Ministers want? What constraints are there on an economy's productio..

  Fixed cost and vairiable cost

Questions:  :   Which of the following are likely to be fixed costs and which variable costs for a chocolate factory over the course of a month?  Explain your choice.

  Problem - total cost, average cost, marginal cost

Problem - Total Cost, Average Cost, Marginal Cost: -  Complete the following table of costs for a firm.  (Note: enter the figures in the  MC   column  between  outputs of  0 and 1, 1 and 2, 2 and 3, etc.)

  Oligopoly and demand curve problem

Problem based on Oligopoly and demand curve,  Draw and explain the demand curve facing each firm, and given this demand curve, does this mean that firms in the jeans industry do or do not compete against one another?

  Impact of external costs on resource allocation

Explain the impact of external costs and external benefits on resource allocation;  Why are public goods not produced in sufficient quantities by private markets?  Which of the following are examples of public goods (or services)? Delete the incorrec..

  Shifts in demand and movements along the demand curve

Describe the differences between shifts in demand and movements along the demand curve. What are the main factors which can shift the demand curve? Explain why they cause the demand curve to shift. Use examples and draw graphs to support your discuss..

  Article review question

Article Review Question: Read the following excerpts from the article "Fruit, veg costs surge' by Todd, Dagwell, published in the Herald on January 25th 2011 and answer questions below:

  Long-term growth, international trade & globalization

Long-term Growth, International Trade & Globalization:- This question deals with concepts such as long-term growth, international trade and globalization. Questions related to trade deficit, trade surplus, gains from trade, an international trade sce..

  European monetary union (emu) in crisis

"Does the economic bailout of Spain and Greece spell the beginning of the end for the European Monetary Union (EMU)?"

  Development game “settlers of catan”

Read the rules of the game, the overview and the almanac for the Development Game "Settlers of Catan"

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd