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Question - BB previously purchased inventory from L. Wong for $15,000. On 1 October gave Wong a 60-day, bill of exchange to cover the amount of the account payable plus interest at 9% p.a. What is the correct accounting entry in BB's books to record the issue of the bill?
a. Debit accounts payable $15,000; debit unexpired interest $222; credit bills payable $15,222
b. Debit bills payable $15,000; debit unexpired interest $222; credit accounts payable $15,222
c. Debit accounts payable $15,000; credit bills payable $15,000
d. Debit bills payable $15,222; credit accounts payable $15,222
Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest. How much control does the Fed have over this longer real rate?
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