Retired persons often have much of their wealth placedin savings accounts and other interest-bearing investments and complain whenever interest rates are low.Do they have a valid complaint?

Q: What is a simple interest rate?

A: Interest is the cost of borrowing money, where the borrower pays a fee to the lender for the loan or…

Q: The central bank is selling $100 worth of bonds payable in one year. The price it gets today is $98.…

A: Do you understand what the "implied interest rate" is? The implicit interest rate in a commercial…

Q: What variables should we consider when dealing with research about cashless economy?

A: With the introduction of the digital era there has been an inclination of people going cashless…

Q: Suppose gdp growth rate is 6%, velocity is constant, money growth rate is 14%. if the inflation rate…

A: The quantity theory of money: It is a theory that shows the relationship between price variation to…

Q: Muhammad takes out a loan of $ 2,130, at 8% simple interest, for 8 years. How much will he pay back…

A: An interest rate is the amount of interest due per period, as a proportion of the amount lent,…

Q: Real interest rates can be negative.  True  False

A: The real interest rate is the inflation adjusted interest rate. That is, inflation implies that real…

Q: If an interest rate pays 9% five times a year, calculate the effective rate of interest. please with…

A: Interest rate is the interest charged to the borrower by the person who makes the loan, calculated…

Q: Explain the concept of interest rates in terms of prime, money markets, repo and borrowing rates

A: Money market is the market in which trading of financial instruments with high liquidity takes…

Q: what happens when interest rate rises?

A: In an economy interest rate plays an important role to determine economic growth and inflation rate.…

Q: Ex Ante and Ex Post Real Interest Rates

A: Ex-ante is when we look at the future event based on all the possible predictions whereas Ex post…

Q: If the price of a one year T-Bill is $2,860 and the value at maturity is $3,000, what would be the…

A: Yield to maturity is given as = (Face value/current value)1/years to maturity - 1 Face value= $3000…

Q: What are Nominal Interest Rates?

A: Inflation refers to a continuous increase in the price of any commodity and service in the economy…

Q: Hi! Can you help me with the question below? Matt has the choice between receiving $100 now or…

A: Matt has the choice between receiving $100 now or receiving $140 in two years. Simple interest…

Q: Evaluate (discussing positives and negatives of) the effect of interest rates on consumer choices.

A: Interest rate: - it is the percentage charge on the principal amount by a lender to a borrower.

Q: Question 3 (2 marks): The Cash Grab Credit Card Company charges a nominal 28 percent interest on…

A: Answer: Given that:     The cash Grab Credit card Company charges a nominal 28 percent interest on…

Q: Banks extend many fixed-rate loans. Why? A farmer buys machinery with a fixed - rate loan to be…

A: Dear student, you have asked multiple sub-part questions in a single post. In such a case, I will be…

Q: What do you mean by capital recovery factor?

A: Capital recovery factor can be explained as the ratio of constant annuity and the annuity's value…

Q: Greg wants to have $50 000 in five years. He has $20 000 today to invest. The bank is offering five-…

A: Given  Greg wants to have $50,000 in five years.  Principal amount = $20,000  Interest rate…

Q: What might cause interest rates to be low one year and high the next?

A: Interest rates are best thought of as the "cost of money." If a borrower wishes to spend more money…

Q: Define the term Interest?

A: Interest refers to the amount of money that an individual gets paid for investing or lending money…

Q: Describe what is Market interest rate?

A: The rate of interest which is determined by the interaction of demand for and supply of funds in the…

Q: Write the formula of Effective interest?

A:

Q: What are the factors determining the changes in interest price and in what way? Analyze on a…

A: There exists positive relationship between money demand and interest price. If the money demand…

Q: At what rate of interest compounded annually will an investment double in five years? Find the…

A: The formulae for compounding is A=P(1+r)t A: Accumulated wealth P: Principle payment r: Annual…

Q: The price of a bond with no expiration date is originally $1,000 and has a fixed annual interest…

A: Given Face value of bond = 1000 Annual interest payment = 150 $ Interest rate = 150 / 1000 * 100 =…

Q: Why interest rates differ at any given time a range of interest rates prevails in the economy. what…

A: The money market equilibrium is determined where money demand is the money supply. It helps in…

Q: Real interest rate is always higher than nominal interest rate  True/False

A: # The difference between Nominal interest rate and inflation rate is given as real interest rate

Q: what is high interest rates?

A: In an economy, interest rate is one of the economic term used at the marketplace when people make an…

Q: According to the Housing Affordability Index (HAI) is it a good time to buy a home in New Jersey?…

A: Median Housing Price in NJ (MEDPRICE)= $500,628 Interest Rate (i) 3.5% compounded monthly = 0.035…

Q: The only kind of interest rate that can be used in the interest formulas is: A simple rate A nominal…

A: Simple Interest:- This is a way for estimating the level of interest imposed on an amount over a…

Q: Compute the following: The present value of $25,000 each year for 4 years at a 7 percent interest…

A: Present value: Present value can be calculated by using the following formula:

Q: If a financial asset that is valued at $18,455 in the Stock Market today would be worth $39,200 in 2…

A: The interest rate is counted as a compounding interest rate in the market as the market money can be…

Q: Define Purchase of Investment.

A: An investment is the purchase of products, the main purpose for which is to have gains. They are not…

Q: (Present Value of an Annuity) Why is $10,000 a close approximation of the price of an annuity that…

A: Present Value of an Annuity) Why is $10,000 a close approximation of the price of an annuity that…

Q: y due an

A: An annuity is a contract entered between a person and an insurance company in which either series of…

Q: In both of the simple and compound interest cases a higher rate means the borrower pays more. true…

A: When an individual borrows money from another individual or financial institutions, he has to pay…

Q: The general case of interest rate is simple interest rate. Select one: True False

A: Simple interest is a simple way to figure out how much money you owe on a loan. Multiply the daily…

Q: Which Interest rate is better to use the simple interest or compounded interest plan, explain your…

A: The interest rate is the amount charged on the principal by the borrower to the borrower to use the…

Q: The interest rate compounded on any pay period is called the nominal interest rate Select one: O…

A: Nominal interest rate refers to the interest rate in the economy without adjusting the inflation…

Q: what are the economic goals of high-interest rate?

A: The interest rate is a proportion of the principal, which is the amount borrowed, that a lender…

Q: Causes and effects of low interest rates

A: The interest rate is determined by the intersection of demand and supply of loanable funds. It is…

Q: 2. Greg wants to have $50 000 in five years. He has $20 000 today to invest. The bank is offering…

A: 2.Given that   Greg wants to have $50,000 in five years.  He has $20,000 today to invest.  Time = 5…

Q: Which factors affect the yield to maturity (or return on investment?

A: Yield to Maturity provides a benchmark for evaluation of different types of investment instruments.

Q: What is the relationship between nominal and effective interest rates?

A: The interest rates refer to the rate at which the loans are given by the banks, or other lending…

Q: What is meant by Prime interest rate?

A: Prime Interest Rate is the interest rate which is determined by the federal funds rate.