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Does present value increase or decrease when the interest rate increases?
decrease
What is the relationship between demand for money and interest rates?
as interest rates increase, demand for money increases.
What effect does an increase in the money supply have on inflation?
An increase in the money supply shifts the money supply curve to the right. If you look on your graph, you will see that an increase in money supply will cause the interest rate to decrease. Here's why: Fed increases money supply-->excess supply of money at the current interest rate -->people buy bonds to get rid of their excess money-->increase in the prices of bonds --> decrease in the interest rate.
If expected inflation increases interest rates are likely to increase?
Yes, inflation and increases in interest rates usually go hand-in-hand, though inflation is not the sole cause of an increase in interest rates
If the fed increases the money supply what will happen to interest rates?
when money supply is increased, interest rates decrease
Does present value increase or decrease when the interest rate increases?
decrease
What is the relationship between demand for money and interest rates?
as interest rates increase, demand for money increases.
Does an increase in interest payable increase or decrease cash flow?
Increase in interest payable increases the cash flow of company as payment is not cleared when due and which causes temporary increase in company's cash flow
Does the amount of interest earned each year increase decrease or stay the same in a simple interest account. What about in a compound interest account?
Simple interest: stays the same. Compound interest: increases.
Does the amount of interest earned each year increase decrease or stay the same in a simple interest account What about in a compound interest account?
Simple interest: stays the same. Compound interest: increases.
Does the present value of money increase as the number of years before the payment is received increases?
No, it should decrease, assuming the interest rate is the same.
What effect does an increase in the money supply have on inflation?
An increase in the money supply shifts the money supply curve to the right. If you look on your graph, you will see that an increase in money supply will cause the interest rate to decrease. Here's why: Fed increases money supply-->excess supply of money at the current interest rate -->people buy bonds to get rid of their excess money-->increase in the prices of bonds --> decrease in the interest rate.
If expected inflation increases interest rates are likely to increase?
Yes, inflation and increases in interest rates usually go hand-in-hand, though inflation is not the sole cause of an increase in interest rates
How does the law of supply and demand work?
In the event that the interest for a product increments, yet the inventory doesn't increment similarly, the cost will increment. On the off chance that the inventory of a ware increments, however the interest for that ware doesn't increment similarly, the cost will diminish. On the off chance that the interest for a product diminishes, yet the stock doesn't diminish similarly, the cost will diminish. In the event that the inventory of an item diminishes, yet the interest doesn't diminish similarly, the cost will increment.
If the fed increases the money supply what will happen to interest rates?
when money supply is increased, interest rates decrease
What tends to result in an increase in the selling price of houses in an area?
An increase in mortgage interest tates.
What causes a decrease in cash flow?
Many things can cause a decrease in cash flow including decrease in sales, increase in expenses, not collecting accounts receivables timely, and increase in interest rates.
