Why are interest rates the opportunity cost of holding gold

Assignment Help Financial Management

Reference no: EM131303108

An article in the Economist magazine notes that "monetary policy has been keeping . . . interest rates, and thus the opportunity cost of holding gold, low and seems set to do so for a while."

Why are interest rates the opportunity cost of holding gold? What effect are low interest rates likely to have on the price of gold?

Reference no: EM131303108

Questions Cloud

Is the information presented in the book true or reliable : Is the information presented in the book true or reliable? Is there relevant information the author does not present which would lead to a different conclusion?

Location of a facility : Our text tells us that the location of a facility is usually related to its capacity. Both fixed costs of plant and equipment and the transportation cost of moving goods play key roles in location decisions.

What happened to the currency to deposit ratio : Briefly explain what happened to the currency-todeposit ratio (C/D) and the excess reserves-todeposit ratio (ER/D) during the financial crisis of 2007-2009.

Examples of overcapacity and under capacity : Find and discuss business examples of overcapacity and under capacity. Your examples should provide arguments for both sides. (Question 6, page 348)

Why are interest rates the opportunity cost of holding gold : Why are interest rates the opportunity cost of holding gold? What effect are low interest rates likely to have on the price of gold?

Calculate the values for the currency to deposit ratio : Calculate the values for the currency-to-deposit ratio, the ratio of total reserves to deposits, the monetary base, the M1 money multiplier, and the M1 money supply.

Traditional-mainstream and social media : Describe how the spotlight is shining squarely on the incident in Stage One. What are the key characteristics of this stage, and how are they manifested in both the traditional, mainstream, and social media? Include two recent examples to illustra..

Discuss the impact of social media in stage one : Discuss the impact of social media in Stage One and Stage Two of crisis reporting. What are some key issues to be aware of and what steps should an organization take with regard to social media during these first two stages of crisis reporting?

Find financial ratios for the company : Find financial ratios for the company and its major competitor in the Internet. Write about 1-2 pages of analysis of the ratio results you received

User Account

All Pages