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Career Plan Building Activity: Competencies and Career Interests Profiler
University of Phoenix
In completing the Career Plan Building Activity and the Career Interests Profiler, I was able to collect interesting and significant information on the career fields that very well can be of interest to me as well as provide information regarding my strengths in where my competencies are applicable. In understanding and having knowledge of my personal competencies, I would be able to improve my critical thinking skills (Geng, 2014).
Understanding critical thinking is important when trying to improve your critical thinking skills. Critical thinking deals with reflective
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Conflict of Interest
CONFLICT OF INTEREST 2
The case I found involving a conflict of interest is Kennedy v. Eldridge, 201 Cal. App. 4th 1197 (2011). This was a family law case involving an unmarried couple and their child. The dispute was over paternity, child support and custody of Calvin Kennedy-Eldridge. The parties involved were the mother, Kayla Kennedy, and father, Tyler Eldridge. The attorney representing Tyler Eldridge was Richard Eldridge. Richard is Tyler’s father, which is where the question of conflict arose.
Attorney, Richard Eldridge had past client and business relations with Kennedy and her family members. Kennedy moved to disqualify Eldridge as Tyler’s attorney
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described so reserved, sober, alert, task oriented and introverted.
3.openness and experience.
Is defined in terms of curiosity and the tendency for seeking and appreciating new experience and novel ideas. Individuals low in openness are defined in terms of curiosity and the tendency for seeking and appreciating new experiences and novel ideas. Individuals who score low on openness are characterized as conventional up artistic and narrow in interest
Is one's interpersonal orientation ranging from soft hearted, good natured, trusting and gullible at one extreme to cynical, rude, suspicious, manipulative at the other party.
Indicate the individual degree of
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Self-Interest in the Marketplace
“It is not from the benevolence of the butcher, the brewer, or the baker, that we expect our dinner, but from their regard to their own self-interest.” This is Adam Smith’s famous quote on the very basic of business motive and every individual involved in the transaction making an earning. Smith argues how one is essentially motivated to go on a venture or transact for self-interest.
Self-interest, very basic motive
Self-interest in this regard by Smith is basically argued that all of the individuals are at the very basic level are motivated to participate in a monetary transaction or other trades for the sake of making a living. Making a living or a good
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DR. TUNKU MOHAR BIN TUNKU MOHD MOKHTAR
SEMESTER 1 2015/2016
“A RESEARCH ON INDONESIA’S INTEREST TOWARDS
JOINING TRANS PACIFIC PARTNERSHIP”
Muhamad Fadel Wijaya (1221665)
Muhamad Fatih Azka (1311515)
Ahmad Azzam Al-Qoyyimuddin (1313511)
INTERNATIONAL ISLAMIC UNIVERSITY MALAYSIA
TABLE OF CONTENTS
1st Chapter: Introduction
B. Importance of the Topic...........................................................................................3
C. Research Question
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QUESTION 2. DISCUSS YOUR INTEREST OUTSIDE YOUR JOB/ OR YOUR EXTRA – CURRICULAR INTEREST/ ACTIVITIES.
The nature of my work is the type that is very demanding. Working with an IT firm has being had being a very demanding part of my life. I am with the administration has to be updating and also marketing our product. Also being the elder sister after my big sister who live in the United Kingdom with my mum and dad, am also faced with left to deal with family concerns on behalf of my parents. But all these do not curtail my passion to help the needy in my neighborhood. Almost everybody in my vicinity refers me to be a very charitable person and is something I do not take for granted. Am the
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Consumer Income, Interest rates, Aggregate demand and supply
Consumer income in the United States can be described as better than most compared to other countries. As of June, consumer income has increased .5 percent and personal disposal income has increased .4 percent (). Although the consumer income increased the consumer expenditures continued to decrease. This displays the consumer’s conservative spending habits. The consumer is yet to fully believe that the economy will continue to strengthen. As history has proven before wages are take time to increase with prices if at all. A middle class individual would be the most to agree with this statement. The rich do not need the help and
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Academic interests and goals
Life is a continuous learning process, which requires a strong method to develop better ways of apprenticeship. Coming from an immigrant family and watching your parents struggling to provide the basic living conditions to you and your siblings isn’t a happy picture. Unfortunately, it follows me every day in school and work. Having in mind what sacrifice my parents did to give me a better education and life, has made me think more seriously about my education, career and personal goals. Thus, being able to obtain a higher education gives me an opportunity to be better in many ways. Everyone should have many goals in life in order to survive, prosper and
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E10-18 Hrabik Corporation issued $600,000, 9%, 10-year bonds on January 1, 2011, for
$562,613.This price resulted in an effective-interest rate of 10% on the bonds. Interest is payable
semiannually on July 1 and January 1. Hrabik uses the effective-interest method to amortize
bond premium or discount.
Prepare the journal entries to record the following. (Round to the nearest dollar.)
(a) The issuance of the bonds.
Jan.1 Cash 562,613, Discount on Bonds Payable 37,387, Bonds Payable 600,000 (To record sale of bonds at discount)
(b) The payment of interest and the discount amortization on July 1, 2011, assuming that interest
was not accrued on June 30. Jul.1,Bond Interest Expense
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Simple interest is the interest that is computed on the original principal only.
If I denotes the interest on a principal P (in dollars) at an interest rate of r per year for t years, then we have
I = Prt
The accumulated amount A, the sum of the principal and interest after t years is given by and is a linear function of t.
A= P + I = P + Prt = P(1 + rt)
A bank pays simple interest at the rate of 8% per year for certain deposits.
a. If a customer deposits $1000 and makes no withdrawals for 3 years, what is the total amount on deposit at the end of three years?
P = 1000, r = 0.08, and t = 3 A=P(I+rt)=1000[1+(0.08)(3)]=1240 or $1240
b. What is the interest earned in that
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On 31-Dec-14 we made the following entry:
Interest Expense $27.36
Discount on Bond Payable ($2.83*5/6) $2.36
Interest Payable ($30*5/6) $25.00
This transaction was made when the share price was $6, but James had not elected to receive common stock as opposed to his usual $25.00 cash coupon. Now that Kat’s common stock price has jumped above $6 per share, James now elects to receive 5 shares of Kat common stock. This does not change the fact that there is a discount to amortize (i.e. the discount must be present as $960 was paid for the face value of $1000) Therefore we must continue to credit discount on bond payable according to the amortization table provided (1/6 now). Now
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Chapter 5 – Mathematics of Finance
5.1 – Simple Interest and Discount
Interest is the fee paid for using someone else’s money. You pay if you borrow money. You earn if you lend money.
Principal – The amount of money borrowed
The amount of interest paid depends on:
* Interest rate
Time Period | Years | Stated Rate | Decimal Form |
72 days | 72/365 | 6 % | .06 |
4 months | 4/12 | Seven and one eighth % | .07125 |
18 months | 1.5 | Half a % | .005 |
Interest can be computed two ways:
* Simple Interest
* Compound Interest
Simple Interest Formula – I = Prt where:
* I – the amount of interest
* P – the amount of principal
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1. Discount = Par value - Issue price = $90,000 - $85,431 = $4,569
2. Total bond interest expense over the life of the bonds
|Amount repaid | |
| Six payments of $3,600 |$ 21,600 |
| Par value at maturity | 90,000 |
| Total repaid |111,600 |
|Less amount borrowed | (85,431) |
|Total bond interest expense
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Chapter 8 Interest Rates
1. What is the interest rate, and how is it determined?
• Price that equates the demand for and the supply of loanable funds; The interest rate is the yearly price charged by a lender to a borrower in order for the borrower to obtain a loan. This is usually expressed as a percentage of the total amount loaned.
• Figure 8-1 shows how interest is determined; supply versus demand
2. Describe how interest rates may adjust to an unanticipated increase in inflation.
• When inflation is volatile from year to year, it becomes difficult for individuals and
businesses to correctly predict the rate of inflation in the near future
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Assume an immediate and sustained one percent across-the-board rise in interest rates. Based on a review of Exhibit 3, discuss how one would use interest rate sensitivity gap information to estimate the impact of rising interest rates on the earnings of Norwest Corporation.
If the interest rates are anticipated to increase by 1 percent then to reduce the impact on earnings the corporation must keep a Positive Gap. This means that the rate sensitive assets should be more than the rate sensitive liabilities. If this is positive then the increase in interest rates increases the net interest income. The Gap of the corporation is mostly positive for all the time periods except for the
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demand resulted the decreasing number of profit. This may cause the exporter to gain loss and to make bank loan was impossible due to the high number of credit interest rate. Since a lot of Indonesia’s business bankrupt, many products from other country with very competitive price come to Indonesia (import increasing). Their price was quite low and the demand for lower price product increasing due to the decreasing of buying power. This condition affects the neraca perdagangan (become deficit).
Nowadays, global economic condition is better, Indonesia’s economic condition also in a better condition. This is a good sign for BI to decrease BI rate, hoping that saving interest rate and credit
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The International Financial Environment
Mesa Co. specializes in the production of small fancy picture frames, which are exported from the United States to the United Kingdom. Mesa invoices the exports in pounds and converts the pounds to dollars when they are received. The British demand for these frames is positively related to economic conditions in the United Kingdom. Assume that British inflation and interest rates are similar to the rates in the United States.
Mesa believes that the U.S. balance-of-trade deficit from trade between the United States and the United Kingdom will adjust to changing prices between the two countries, while capital flows will adjust to interest rate
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Week 2 : Time Value of Money - Homework ES
Question 1. 1. (TCO 3) You have been approved for a $70,000 loan toward the purchase of a new home at 12% interest. The mortgage is for 30 years. How much are the approximately annual payments of the loan? Hint: Assume you pay yearly. (Points : 3)
None of the above
Question 2. 2. (TCO 3) First Choice Bank pays 9% APR compounded quarterly on its business loans. National Emerald Bank pays 16% APR compounded daily. The EAR for First Choice and National Emerald Bank are: (Points : 3)
9.31% and 17.35
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Formulas For Common Ratios
One-year Growth Rate Xt −Xt−1 Xt−1 Xt Xt−n
Compound Average Growth Rate (CAGR)1
Gross Margin Operating Margin Net Margin Return on Assets (ROA)2 Return on Beginning Equity (ROBE)3 Return on Invested Capital (ROIC)4 Pretax Return on Invested Capital Gross Proﬁt Sales EBIT Sales Net Income Sales EBIT(1-Tax Rate) Average Total Assets Net Income Beginning Equity EBIT(1-Tax Rate) Interest-bearing Debt + Equity EBIT Interest-bearing Debt + Equity
n denotes the number of periods between observations Xt and Xt−n . Ratios that compare balance sheet and income accounts are often computed using the average of the
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1. A change in interest rate will affect the cost of borrowing, the income generated from tangible assets and stock’s value that the financial institution owns that will lead to profits or losses as a result.
2. The Federal Reserve’s Policies such as monetary policy could affect interest rates, inflation, and the supply of the money. These three factors are directly related to the profitability of financial companies. So the managers care so much about the Fed activities.
3. The family members are closed to you than a stranger. You could know the credibility of the family members but not the strangers. Under the asymmetric information, you can reduce the risk of being bad
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them easier to sell. b) You expect a bear market in stocks (stock prices are expected to decline). c) Brokerage commissions on stocks falls. d) You expect interest rates to rise. e) Brokerage commissions on bonds fall. 3. The demand and supply for one-year discount bonds with a face value of $1,000 are given below where P is the bond price and W , investors’ wealth.
a) b) c) d) e)
6100 5 1 P W and Q s P 600 3 3 6
Find the equilibrium bond price as a function wealth. Find the equilibrium quantity as a function of wealth. Find the equilibrium interest rate as a function of wealth. All else equal, if wealth increases, what happens to the interest rate? Why. Suppose that
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What is a Current Account ? Who uses current accounts? Current Accounts in Banks
Current Accounts are basically meant for businessmen and are never used for the purpose of investment or savings. These deposits are the most liquid deposits and there are no limits for number of transactions or the amount of transactions in a day. Most of the current account are opened in the names of firm / company accounts. Cheque book facility is provided and the account holder can deposit all types of the cheques and drafts in their name or endorsed in their favour by third parties. No interest is paid by banks on these accounts. On the other hand, banks charges certain service charges, on such
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1.Calculate Invoice price for bond maturing Nov. 15, 2012 (in Excel). Assume today’s date is 1/15/2009
2. Find the duration of a 6% coupon bond making annual coupon payments if it has three years until maturity and a yield to maturity of 10%.
3. A) A zero-coupon bond with face value $1,000 and maturity of 6 years sells for $887.25. What is its yield to maturity?
B) What will happen to its YTM if the price goes up to $899.99?
4. Why do bond prices go down when interest rates go up? Don’t investors like high interest rates?
5. A) ABC bond has a 3.5 coupon and 9 years till maturity
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38. Kevin deliberately omitted $40,000 of gross income from the restaurant that he owned from his 2012 tax return. The return indicates gross income of $ 200,000 when he files it on April 14 2013. As of what date can the IRS no longer pursue Kevin with the threat of collection of the related tax, interest, and penalties?
There is no statute of limitation. The IRS can pursue Kevin with additional taxes, interest, and penalties if they are able to prove fraud was committed by deliberately omitted $40,000 of gross profit. However if the IRS is unable to prove Kevin deliberately omitted $40,000 of gross income as fraud expire date would be April 15, 2016
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Five (5) years ago, you bought a house for $171,000, with a down payment of $30,000, which meant you took out a loan for $141,000. Your interest rate was 5.75% fixed. You would like to pay more on your loan. You check your bank statement and find the following information:
Principle and Interest payment
Current Loan Balance
Write a one to two (1-2) page paper in which you address the following:
With your current loan, explain how much additional money you would need to add to your monthly payment to pay off your loan in 20 years instead of 25. Decide whether or not it would be
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Q1. What is risk premium? How is it measured? When there is an increase in the default risk on corporate bonds (due to bad economic conditions), what will happen to risk premium. Will it shrink or widen? Why?
(See pages 120-22 3rd edition) (see page 114-115 4th edition)
Default risk occurs when the issuer of a bond is unable or unwilling to make interest payments when promised or pay off the face value when bond matures. This could happen to a corporation suffering high losses due to bad economic conditions. Canadian Government bonds are considered to have no default risk, as its backed by the taxation power. These bonds are called default free bonds. The spread between the interest
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The current housing market is currently seeing the lowest interest rates for mortgages in recent history. With so many houses in foreclosures and even more neighborhoods and housing markets suffering from the current economic crisis the likelihood of people buying homes has decreased over the past few years. With federal agencies such as the Housing and Urban Development (HUD), The Federal Reserve System, and FEMA, helping to determine housing costs, developmental costs, annual living expenses, and other variables play specific parts in determining market value for homes as well as interest rates on mortgages. Prime lending rates are a huge factor. It will determine whether or not a lender
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Provide short answers to the following:
(a) Explain how the money market determines the nominal interest rate.
The nominal interest rate on other assets minus the nominal interest rate on money is the opportunity cost of holding money.
(b) Discuss in detail how an open market purchase of securities by the Reserve Bank impacts the money market in the short run.
Starting from a short-run equilibrium, if the Reserve Bank increases the quantity of money, people find themselves holding more money than the quantity demanded. With a surplus of money holding, people enter the loanable funds market and buy bonds.
(c) Explain how the money market then moves back to equilibrium in the
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not to use a given amount of money today, with intentions of using it in the future, he should put that money in a saving account. That way, the money will accrue interest and it will not be of the same amount as initially saved. The amount of interest accrued on saved money depends on three things: the initial amount saved, the bank interest rate and the span of time the money will be saved. Inflation is another factor to be considered when calculating the interest to be accrued. If the inflation is high, the interest reduces since the ‘value’ of money reduces (Carr, 2006).
This paper will discuss this concept of time value of money with the help of a question problem. Assuming I am 30
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– $100,000) | 1,912 |
Ben Holt has obtained several forward contract quotations for the Thai baht to determine whether covered interest arbitrage may be possible. He was quoted a forward rate of $0.0225 per Thai baht for a 90-day forward contract. The current spot rate is $0.0227. Ninety-day interest rates available to Blades in the United States are 2 %, while 90-day interest rates in Thailand are 3.75 % (these rates are not annualized). Holt is aware that covered interest arbitrage, unlike locational and triangular arbitrage, requires an investment of funds. Thus, he would like to be able to estimate the
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BS1780 Macroeconomics for Business
Problem Set 3
Assuming that the nominal interest rate, the inflation rate, the real GDP growth and primary deficit remain constant for the next year, we can compute the projected next year end debt as a percentage of GDP by using the equation:
In this case, dt is the public debt (as % of GDP) of 2011, which is 88%; i is the government interest rate 7% according to our assumption; π is the inflation rate, which was 2% if it is held constant constant in the next year; gr is -1%, the real GDP growth; and -st+1 is the primary deficit, which is 3%. Therefore:
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Christian Ethics Project One
1. What is the difference between self-interest and selfishness? Why is this distinction important when considering the competitive market economy as appropriate for a society?
Self-interest and selfishness are two terms that are talked about in Stapleford’s book BULLS, BEARS, AND GOLDEN CALVES. Frist we must define these two terms to help us understand the difference between them. Self-interest is when someone is trying to protect their interest, but they also take into account how it may affect others. Selfishness is when one makes decisions based on self with no regard to others. Now that we have defined the two terms we can use this to consider the
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states “Examples of situations that individually or in combination would normally lead to a lease being classified as a finance lease are (a) the lease term is for the major part of the economic life of the asset even if title is not transferred; and (d) at the inception of the lease the present value of the minimum lease payments amounts to at least substantially all of the fair value of the leased asset substantially all of the fair value of the leased asset.”
2. Was the senior accountant’s analysis correct? Why or why not?
The senior accountant is correct in his assertion that the lease is a financing lease. However, he has chosen the wrong interest rate. The lessee has an 11
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Chapter 3:Problem 2
2. Consider an economy in which taxes, planned investment, government spending on goods and services, and net exports are autonomous, but consumption and planned investment change as the interest rate changes. You are given the following information concerning autonomous consumption, the marginal propensity to consume, planned investment, government purchases of goods and services, and net exports:
Ca=1500-10r ,c=0.6 ,T=1800
Ip=2400-50r ,G=2000 ,NX=-200
a. compute the value marginal propensity to save is as follows: 1-C=1-0.6=0.4
b. Autonomous planned spending, Ap, equals Ca − cTa + Ip + G + NX = 1,500 − 10r −.6(1,800) + 2,400 − 50r + 2,000
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1. Three Functions of Money
A) Measure of value
B) Store of purchasing power
C) Store of purchasing power
D) Store of purchasing power
E) Means of exchange
F) Store of purchasing power
4. Bond Price Changes
A) A bond worth $10 000 initially and has an interest rate
of 4 percent, annual interest rates would be $400.
A drop in interest rate to 2 percent means that the price of
this bond rises to $20 000. (.02 x $20 000 = $400).
B) A rise in interest rate to 6 percent causes the price
of this bond to decline to $6667 (.06 x $6667 = $400).
5. Hudson Bank
A) Desired reserves are .05 x $10 million =$500 000.
Actual reserves are $600 000, it has $100 000 in excess
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Exam I AC202
Name Anthony Edwards
Multiple Choice: Chose the one best answer for each of the following (2 points each)
1. Which of the following does not impact the calculation of the cash interest payments to be made to bondholders?
a. Face value of the bond
b. Stated interest rate
c. Market interest rate
d. The length of time between payments
2. Which of the following is false when a bond is issued at a premium?
a. The bond will issue for an amount above its face value
b. Interest expense will exceed the cash interest payments
c. The market interest rate is lower than the stated interest rate
d. The issue price will be
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brought by a loose-fitting monetary policy. Through the use of several graphs, he explains that the Federal Reserve caused the lending bubble because they did not follow the “Taylor Rule” and its inflation-based policy for interest rates. The Fed needed to raise interest rates sooner to minimize the “boom and bust” in the housing market. Low interest rates and the pressure on Fannie Mae and Freddie Mac to increase home sales prompted the boom because it spurred the sub-prime mortgage market. The bust followed because the boom was unsustainable.
By tracking the LIBOR index during the crisis, Taylor shows how the Fed prolonged the problem by misdiagnosing the reason for the increased spreads
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A New House and the Economy
A New House and the Economy
The decision to purchase a new home is a significant one to say the least. With the current conditions of the economy the decision should be calculated down to the very last detail. The consequences of purchasing a new home will have a direct affect on the rest of your life, so the choice to purchase a new home should be one made with confidence and plenty of knowledge. You must take into account all the variables that will come into play such as the economy, the market, interest rates, housing prices, and most important your financial and employment status.
The current status and strength of the economy and your
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1.) Explain how futures contracts could be used to hedge a bond portfolio against the risk of rising interest rates. Then explain how futures could be used by exporters and by importers to hedge against their foreign-exchange exposures.
Someone with a large bond oprtfolio may want to hedge against future interest rate movements. When interest rates rise, bond prices decline. The use of futures can be used to hedge against the likelihood of rising interest rates. When the hedging is balanced, the gains/losses in the cash holdings will be offset by gains/losses in futures account. Hedging bond portfolios with futures contracts, will be done by holding short positions.
Futures could be
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agree with Obama’s plan I have created a group who will take political actions against the Immigration Plan. Because Obama refuses to listen to the public, though I am sure most of the United States has no clue about this plan, I will make it known through media. So our political group would go about a public meeting and generate letters to send to local news or newspapers. Creating this special interest group could seek power by participating in volunteer work throughout the community would draw Television reporters to our meetings and hearings and hopefully raise awareness of the Immigration Plan. The outcome I think could be huge enough that the public would help spread this plan making
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III – Solutions
2. Reasons for that high interest rate
2.1. Reason 1 - Sustaining liquidity
Since the international financial crisis of 2008, the Vietnamese economy has been not only swept up by the current of global recession but also has struggled with its inherent perennial challenges. Hence, the health of baking system has worsened as well. High inventory levels are attributed to low credit growth and an increase in banks’ bad debts. Many commercial banks have reduced their interest rates after the State Bank of Vietnam (SBV) decided to cut lending rates in more than three years to help local businesses iron out snags in their current economic difficulties. By far, 15 of
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Banks are financial institution which directly of indirectly influences every modern man’s life. In its simplest form, a bank is an institution where its clients keep their surplus deposits, and these deposits are invested in trade, commerce and industries on term basis, i.e. short, medium and long term. A bank connects customers with capital deficit to customers with capital surplus.
A bank’s deposits are its liabilities, and its loans and investments are its assets. It generates revenues in a variety of different ways including interest, transaction fees and fees for financial advices. The main method is via charging interest on the funds it lends out to
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Many factors influence the interest rate of a loan. The two greatest factors are the probability of the borrower paying back the loan; and, the “cost” of the money to the lender. As a rational entity, the lender aims to maximize its gain on its assets. When the lender makes a loan to a borrower, it reviews the current market price for money (interest rate). There are various benchmarks used by lenders to determine the market value of loaned money. This memorandum will discuss the London InterBank Offering Rate (LIBOR), one of the most widely used benchmarks, and how it affects our economy.
What is the Libor?
The LIBOR is a widely used measure of the current market price
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It is my understanding that GlobalEd Inc., has set up a wholly foreign-owned enterprise (WFOE) within the Peoples Republic of China (PRC) for the purpose of gaining control of a PRC-domiciled enterprise. Additionally, whether the Enterprise created by related parties of the WFOE, the Nominee Shareholders, is a variable interest entity (VIE), and if it requires consolidation. Analysis of the Equity Pledge Agreement, Call Option, and Management Service Agreement, various contractual agreements, should provide insight into these concerns and if consolidation is necessary. Review of the agreements will either support or negate the qualifications of VIE, as well as, primary beneficiary
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policies. A monetary stimulus from the Federal Reserve was also offered. A monetary policy usually works at a fast pace while providing good results. This policy provides a lower interest rate for consumers. These new interest rates will also benefit businesses by giving them the opportunity to hire more people. As a result, an increase occurs in sales because the demand is back. This demand will boost the economy and get it back on track. The Keynesian concept disagrees with the views held by some economists. Lower salaries can restore full employment, by arguing that employers will not add employees to create goods that cannot be sold because demand is weak (Monetary Policy and the Economy
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The Crowding-Out Effect
The offset in aggregate demand resulting from when expansionary fiscal policy raises the interest rate and thereby reduces investment spending.
* Whilst an increase in gov purchases stimulates AD for goods and services, this causes national incomes to rise → increase in demand for money (MD shifts right) → causing the interest rate to rise → reduction in investment spending and chokes off AD.
Fiscal Policy and Aggregate Supply
NEED TO FIND SOME NOTES HARD TO UNDERSTAND LECTURE SLIDES
Changes in fiscal policy that stimulate AD when the economy goes in recession, without policymakers having to take any deliberate
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Euro bonds and International bonds
Debt investments that are issued in a country by a non-domestic entity. International bonds are issued in countries outside the United States, in their native country's currency. They pay interest at specific intervals, and pay the principal amount back to the bond's buyer at maturity.
International bonds include eurobonds, foreign bonds and global bonds. A different type of international bond is the Brady bond, which is issued in U.S. currency. Brady bonds are issued in order to help developing countries better manage their international debt. International bonds are also private corporate bonds issued by companies in foreign countries, and many mutual
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The Federal Reserve Bank has been mandated by the Congress to execute monetary policies on behalf of the government in a meticulous manner such that the system remains liquid at all times. The FEDS has two specific mandates assigned by the Congress; one, to ensure that there is the sustainability of employment opportunities and output and two, to stabilize prices of commodities (or stabilize the rate of inflation), (Engen, Laubach and Reifschneider 2-3). To ensure that these mandates are met, the FEDS sets achievable and sustainable targets for the interest charged on loans as well as the Federal Reserve funds, which are overnight credit facilities
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the decision to proceed, and these may be important.
Note that NPV analysis is not the same as Cost Benefit Analysis. Cost Benefit Analysis is the wider process of proposal selection. NPV analysis is just one tool which may be applied in Cost Benefit Analysis.
4. Explain how an interest rate is just a price.
Think of interest rate as price. If the price of a good is low, lots of people will want to buy it high demand, thus factories will be less inclined to produce it because they make smaller profits, low supply. If the price of a good is high, fewer people will be able to afford it, factories will want to produce lots of it because they make big profits. If demand is greater than