![tinagibbs98](/avatars/2012.jpg)
tinagibbs98
12.01.2021 •
Business
Three students have each saved $1,000. Each has an investment opportunity in which he or she can invest up to $2,000. Here are the rates of return on the students’ investment projects:
Student Return
(Percent)
Yakov 4
Charles 7
Dina 15
Assume borrowing and lending is prohibited, so each student uses only personal saving to finance his or her own investment project.
Complete the following table with how much each student will have a year later when the project pays its return.
Student Money a Year Later
(Dollars)
Yakov
Charles
Dina
Now suppose their school opens up a market for loanable funds in which students can borrow and lend among themselves at an interest rate rr.
If a student’s expected rate of return is greater than r, he or she would choose to (lend, borrow).
Suppose the interest rate is 6 percent.
Among these three students, the quantity of loanable funds supplied would be $, and quantity demanded would be $.
Now suppose the interest rate is 12 percent.
Among these three students, the quantity of loanable funds supplied would be $, and quantity demanded would be $.
At an interest rate of % , the loanable funds market among these three students would be in equilibrium. At this interest rate, (Charles, Yakov, Yakov and Charles, Charles and Dina, Dina) would want to borrow, and (Charles, Yakov, Yakov and Charles, Charles and Dina, Dina) want to lend.
Suppose the interest rate is at the equilibrium rate.
Complete the following table with how much each student will have a year later after the investment projects pay their return and loans have been repaid.
Student Money a Year Later
(Dollars)
Yakov
Charles
Dina
True or False: Only borrowers are made better off, and lenders are made worse off.
Solved
Show answers
More tips
- H Health and Medicine Impeccable Memory: How to Improve It...
- L Leisure and Entertainment How Many Seasons are There in the TV Show Interns?...
- S Sport When will the Biathlon World Championships 2011 take place in Khanty-Mansiysk? Answers to frequently asked questions...
- H Health and Medicine Trading Semen for Money: Where Can You Sell and Why Would You Want to?...
- F Food and Cooking Homemade French Fries: The Ultimate Guide...
- H Health and Medicine How to Increase Blood Pressure without Medication?...
- S Style and Beauty Choosing a Hair Straightener: Specific Criteria to Consider...
- F Food and Cooking How to Make Polendwitsa at Home?...
- S Science and Technology When do we change our clocks?...
- L Leisure and Entertainment What to Give a Girl on March 8?...
Answers on questions: Business
- B Business Consider a simple economy whose only industry is printing. in this industry, productivity—the amount of goods and services a worker can produce per hour—is measured by the number...
- B Business The current price of the common stock of Internet Enterprises is $100. Over the course of a year, the stock s price will either increase by 100% or decrease by 50%. The stock...
- B Business Greg is the CEO of a leading company in the consumer packaged goods industry. He is trying to grow his company for personal gain and wealth. However, Greg sees that his company...
- B Business Which term is a measure of the reliability of a research study? 1. internal consistency 2. externality 3. concurrence 4. subjectivity...
- E English I’m the book The Hobbit, what words best describes the village that Bilbo lives in?...
- M Mathematics Help me pls...............
- M Mathematics If 9 x 158 = 1,422, then...
- M Mathematics Challenge An arts academy requires there to be 3 teachers for every 51 students and 5 tutors for every 55 students. How many students does the academy have per teacher? Per...
- M Mathematics Which statements are true about the graph of –6.5 x? Check all that apply....
- B Business Please helppP Refer to the diagram. The concept of opportunity cost is best represented by the Multiple Choice A. shift of the production possibilities curve from PP1 to PP2....
Ответ:
Complete the following table with how much each student will have a year later when the project pays its return.
Student Money a Year Later
Yakov $1,040
Charles $1,070
Dina $1,150
Now suppose their school opens up a market for loanable funds in which students can borrow and lend among themselves at an interest rate r.
If a student’s expected rate of return is greater than r, he or she would choose to (lend, borrow).
Suppose the interest rate is 6 percent.
Among these three students, the quantity of loanable funds supplied would be $1,000, and quantity demanded would be $2,000.
Now suppose the interest rate is 12 percent.
Among these three students, the quantity of loanable funds supplied would be $2,000, and quantity demanded would be $1,000.
At an interest rate of 7%, the loanable funds market among these three students would be in equilibrium.
At this interest rate, Yakov would want to borrow, and Dina want to lend.
Suppose the interest rate is at the equilibrium rate.
Complete the following table with how much each student will have a year later after the investment projects pay their return and loans have been repaid.
Student Money a Year Later
(Dollars)
Yakov $1,070
Charles $1,070
Dina $1,230
True or False: Only borrowers are made better off, and lenders are made worse off.
Ответ: