What the equilibrium interest rates for the federal funds

Assignment Help Business Economics

Reference no: EM1319104

Q. Assume to the equation for autonomous planned spending is Ap = 6,200 - 200r also the value of the multiplier, k, 2.5.

(a) Derive the equation for the IS curve, Y=kAp. Graph the IS curve for interest rates among 0 also 8, with intervals of one-half of a percent (%)age point.

(b) Assume the equation for the LM Curve is Y=13,500 +100r. Utilize this equation to Elucidate the level of income at that there is a zero lower bound on the federal funds rate the interest rate to the Fed controls.

(d) Assume to the term premium is 1.0 percent (%)age point also the risk premium is 2.0 percent (%)age points. utilize the LM curve with the zero lower bound also term premium also risk premium to graph the LM curve for the government bond rate also the LM curve for the private bond rate at interest rates among 0 also 8, with intervals of one-half of a percent (%)age point.

(e) Utilize the graphs of the IS curve also the three LM curves to Elucidate what the equilibrium interest rates for the federal funds rate the government bond rate also the private bond rate are also Illustrate what the equilibrium level of income is.

Reference no: EM1319104

Questions Cloud

Determining mean of probability distribution : Determine the mean and standard deviation of following probability distribution.

Estimate an average amount of sick leave per employee : A certain firm specializing in the manufacture and sale of free time clothing has 80 retail stores in Florida and 140 in California. With each state as a stratum, the firm wishes to estimate average sick-leave time per employee for the past year

Solve for the unknown variable : Solve for the unknown variable

Probability in case of a randomly selected sample : Determine the probability that a randomly selected sample of 31 patients would produce an average diameter of 6.6 mm or less for the non affected tendon?

What the equilibrium interest rates for the federal funds : Elucidate what the equilibrium interest rates for the federal funds rate the government bond rate also the private bond rate are also Illustrate what the equilibrium level of income is.

Solve the unknown variable : Solve the unknown variable

Approximation the total number and bound on the error : A company auditor was interested in estimating the total number of travel vouchers that were incorrectly filed. In a SRS of size n =50 oft of the group of N = 250, were filed incorrectly.

Relative frequency and bar chart : Perform a study to compare the characteristics of patients discharged against medical advice from the institution

Way to identify family types for pricing purposes : There is no way to identify family types for pricing purposes also all costs are fixed so to maximizing total income is equivalent to maximizing profit.

User Account

All Pages