0
If the Federal Reserve chairman says that overnight loan rate at the Discount Window will be raised, and reserve requirements of member banks will be raised, this in turn will effect interest rates of many kinds. Normally it means the prime rate of major banks to their prime customers will rise.
This will also increase mortgage rates and all types of loans. The Fed does this to further its monetary policies. Normally, the Fed's action means it believes that economic activity in the economy needs to reduced to a certain extent.
What else can I help you with?
What is the ultimate impact on the money supply of an increase in the discount rate?
The increase in the discount rate will cause the money supply to reduce in growth
What is the most likely effect of the fed lowering the discount rate on overnight loans?
An increase in the money supplyAn increase in the money supply
What change is definitely predicted to lower Real GDP in the short run?
A decrease in aggregate demand, an increase in the reserve requirement, an increase in the discount rate, increase in interest rates, a decrease in government spending.
What is the effect of a raise in discount rates?
Discount rate = inflation expectation + risk premium for the investment, so when inflation goes up, your discount rate should go up
What describes the most likely effect of the Fed lowering the discount rates on overnight loans?
An increase in the money supply
What is the ultimate impact on the money supply of an increase in the discount rate?
The increase in the discount rate will cause the money supply to reduce in growth
Is it legal to raise health insurance premium for not submitting to blood work?
It can be if the blood work is a condition of underwriting. When this happens what you generally find in the small print is the higher rate is actually what you are charged with a discount for complying with all the underwriting requirements. It is technically the loss of a discount not an increase in the premium.
Does the npv of future cash flows increase or decrease as the discount rate increases?
NPV decreases with increasing discount rates.
What term indicates a gradual increase in dynamic level?
Crescendo
What is a change that indicates the acceleration of an object?
An increase in speed or velocity.
To increase a given present value the discount rate should be adjusted?
To increase a given present value, you would generally lower the discount rate. This is because a lower discount rate reduces the impact of future cash flows, making the present value higher. Conversely, increasing the discount rate would decrease the present value.
What is the most likely effect of the fed lowering the discount rate on overnight loans?
An increase in the money supplyAn increase in the money supply
Which straight-line acceleration indicates an increase in speed?
Positive acceleration indicates an increase in speed in a straight line. This means the object is moving faster with time.
Does the sales discount increase an operting expense account?
Sales discount is a reduction of actual sales. It is not an expense rather it is the reduction is selling price which reduces the sales.
A credit to a liability account?
indicates an increase in the amount owed to creditors.
WHich acceleration indicates an increase in speed?
4 m/s (squared)
What is the most likely effect of the Federal Reserve lowering the discount rate on overnight loans?
The most likely effect of the Federal Reserve lowering the discount rate on overnight loans would be an increase in the money supply. an increase in the money supply
