Currently, interest rates in the economy are the lowest they
have ever been. Based on this...
Currently, interest rates in the economy are the lowest they
have ever been. Based on this realization, what should banks do as
far as their duration gap and funding gap? Support each answer with
one explanatory sentence.
Currently, interest rates in the economy are the lowest they
have ever been. Based on this realization, what should banks do as
far as their duration gap and funding gap? Support each answer with
one explanatory sentence.
Interest rates in Australia are currently at their lowest level since the Reserve Bank of Australia was established in 1959. Outline the rationale for such low interest rates, and evaluate the extent to which this policy makes sense in Australia's current situation. Make sure to take into account both the dangers of keeping interest rates low for protracted periods of time, as well as the potential benefits of such an approach to monetary policy. In the light of your evaluation,...
Are you currently or have you ever been in love? If so, what
attracted you to that person? Do the reasons that attracted you to
that person agree with theories and research on interpersonal
attraction? Which theories? Explain your answer, comparing or
contrasting your relationship to theories of interpersonal
attraction. If you have never been in love, analyze a friend's love
relationship.
Rank the following interest rates from lowest to the highest and
identify it is a source (S) or use (U) of capital. If it is both a
source and use of capital, then state both (B)
- Federal Funds Rate (FFR)
- LIBOR
- Interest on Reserves (IOR)
- Discount Rate (DR)
- Prime Rate
- Risk Free Rate
- Reverse Repurchase Agreements (Repos)
Have you ever experienced a conflict of interest or been tempted to
do something that you thought went against your job
responsibilities? Describe an employment or business-related
situation where your self-interest diverged from what you believed
to be morally right.
a) What three factors have been suggested for the decline in
real interest rates in the world?
b) Explain why the Phillips curve relationship in the basic New
Keynesian model takes the form it does.
c) If there is a decline in the natural rate of interest, what
problem can this create for monetary policy?
d) How does forward guidance help the central bank deal with a
low natural real rate of interest?
Consider the market for wheat. Most farmers have loans that are
based on flexible interest rates (i.e. they change with the market
rate). Starting off from equilibrium, demonstrate graphically (and
write into a table) what happens to P,Q,q, and Profits in the
short-run, and long-run, if the interest rate decreases. Provide
explanation please!
Rank the following bonds based on their interest rate risk, from
the lowest to the highest, if all other terms of the bonds are the
same: an inverse floater, a floater, and a fixed-rate bond.