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Economics Multiple Choice Question (1 Viewer)

michaeljennings

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What would be the most likely effect of the RBA purchasing gov't securitires
a) A decrease in liquidity and a decrease in interest rates
b) An increase in liquidity and a decrease in interest rates
c) A decrease in liquidity and an increase in interest rates
d) An increase in liquidity and an increase in interest rates

Is the answer A or B? i thought it was B but i wanna make sure
 

sakatahahaha

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Lol how can you have second thoughts and think its A review your monitery policy chapter

The govt buys second hand government security in the over night money market to indirectly influence interest rates

Why ??

Because banks borrow money of each other too in the O.N.M.M now thru charge each other something called the cash rate. If banks have heeps of their uhm exchange settlement accounts the cash rate they charge will be smaller. By the govt buying these securities they increase the availability of money in the accounts hence they will charge the banks a lower cash rate and the banks won't need to make back bIg profit so the NOMINAL INTEREST RATES will be lower

If the bank sold govt securities opposite would happen.
 

michaeljennings

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Alrighty can you guys do this question
he table shows the human development index (HDI) values for two countries.
Country HDI
A 0.3
B 0.9
Which statement is most consistent with the HDI data given?
(A) Adult literacy rates are higher in Country A than in Country B.
(B) The level of urbanisation is greater in Country A than Country B.
(C) The population growth rate in Country A is higher than in Country B.
(D) Public institutions are more developed in Country A than in Country B.

The answer is C but i have no idea why
 

slyhunter

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Alrighty can you guys do this question
he table shows the human development index (HDI) values for two countries.
Country HDI
A 0.3
B 0.9
Which statement is most consistent with the HDI data given?
(A) Adult literacy rates are higher in Country A than in Country B.
(B) The level of urbanisation is greater in Country A than Country B.
(C) The population growth rate in Country A is higher than in Country B.
(D) Public institutions are more developed in Country A than in Country B.

The answer is C but i have no idea why
A has a low standard of living than B, hence (A), (B) and (D) cannot be true.

Common sense.
 

powlmao

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Alrighty can you guys do this question
he table shows the human development index (HDI) values for two countries.
Country HDI
A 0.3
B 0.9
Which statement is most consistent with the HDI data given?
(A) Adult literacy rates are higher in Country A than in Country B.
(B) The level of urbanisation is greater in Country A than Country B.
(C) The population growth rate in Country A is higher than in Country B.
(D) Public institutions are more developed in Country A than in Country B.

The answer is C but i have no idea why
As Sly said it is common sense.

The Human Development Index is a statistic used to rank countries by level of development and separate them into ranks of development" countries.

Human Development Index (HDI) is a comparative measure of life expectancy, literacy, education and standards of living for countries worldwide. It is a standard means of measuring well-being.

Countries with high HDI will always have better qualities than lower HDI countries
 
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michaeljennings

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year 12, another question i have:
When you are given nominal GDP and CPI and you need to calculate real GDP is it just nominal GDP divided by CPI times by 100?
 

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