Part I – Relation between BI rate and banks interest rate A. BI rate We take the BI rate‚ as the variable being estimated‚ from the period of 2006 until 2012. We then take the average rate in each year‚ rather than taking the rate in each month. As a note to the year 2012‚ we take the average rate that ranges only from January until August. Figure 1. BI rate (Percent per Annum) Source : Indonesian Financial Statistics‚ Bank of Indonesia‚ http://www.bi.go.id/web/en/Statistik/Statistik+
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included or not included in GDP. Give an explanation for those that you judge as not included. State when applicable‚ the expenditure category in which each good is included. a. The purchase of copy paper by PepsiCo‚ which is used by the company staff. Answer: This case is not included in GDP‚ because it is an intermediate goods. b. The purchase of an electronic handheld organizer by a sales manager to keep track of clients. Answer: This case is included in GDP‚ because it belongs to Produced
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running shoes? What factors might account for the decrease in supply? Problem # 3 The table above gives the demand and supply schedules for CDs. a. According to the table‚ what is the equilibrium price? b. Suppose the government imposes a price floor of $16 for a CD. What is the result? c. Suppose the government imposes a price ceiling of $8 for a CD. What is the result? Problem # 4 If you sell your textbook to your friend this year‚ does the sale count in this year’s GDP? Problem #
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1 One-factor Interest Rate Modeling 1 In this lecture... q stochastic models for interest rates q how to derive the bond pricing equation for many fixed-income products q the structure of many popular interest rate models 2 2 Introduction In this lecture we see the ideas behind modeling interest rates us-ing a single source of randomness. This isone-factor interest rate modeling. q The model will allow the short-term interest rate‚ the spot rate‚ to follow a random walk. This model leads
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This entry gives an estimate from the US Bureau of the Census based on statistics from population censuses‚ vital statistics registration systems‚ or sample surveys pertaining to the recent past and on assumptions about future trends. The total population presents one overall measure of the potential impact of the country on the world and within its region. Note: Starting with the 1993 Factbook‚ demographic estimates for some countries (mostly African) have explicitly taken into account the effects
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The US has recently reached the lowest unemployment rate： 4.5%. In this article‚ the author provided different aspects of US’s low unemployment rate and the result of such a low unemployment rate. Comparing to the unemployment rate (10%) after 2008’s recession‚ US is now reaching a relatively low unemployment rate. A low unemployment rate is one of the four macroeconomic objectives that economists always want their nations to achieve. Unemployment is simply defined as the state of being out of
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Major Determinants of Interest Rates Inflation Inflation is a factor that decisively affects the nature or outcome of interest rates. “Inflation is an increase in prices of goods and services over time”(Financial Institutions‚ Instruments and Markets‚ 2012). Inflation is the natural byproduct of a robust‚ growing economy. No inflation‚ or deflation (the lowering of prices)‚ is actually a much worse economic indicator. Also‚ in a healthy economy‚ wages rise at the same rate as prices. A standard
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THE EFFECTS OF EXCHANGE RATE IN INFLATION OUTPUT AND THE CURRENT ACCOUNT ABSTRACT The empirical studies on the effects of changes in exchange rates on inflation and real activity can be broadly divided into four categories: Single-equation econometric methods‚ Vector autoregressive (VAR) models‚ Structural macro econometric models and DSGE models - Dynamic stochastic general equilibrium. Methodologies: First‚ most participants use single-equation econometric methods that estimate
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Assignment 4 5. According to the IS-LM model‚ what happens to the interest rate‚ income‚ consumption and invest under the following circumstances. a. The central bank increases money supply. An increase in the money supple shifts the LM curve downward. The equilibrium moves from point A to point B. Income rises from Y1 to Y2 and the interest rate falls from r1 to r2. Therefore this increase in money supply causes a decrease in interest rate‚ an increase in income‚ an increase in consumption and an increase
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Limitations…………………………………………………………….3 Methodologies……………………………………………………………………...3 Interest rate and its determinants…………………………………………………3-5 Analysis of regression equation………………………………………………….6-7 Analysis of correlation matrix……………………………………………………7-8 Conclusion…………………………………………………………........................8 Bibliography……………………………………………………………………….8 Determinants of Interest Rates in Bangladesh Executive Summary: Interest rate is applicable on all type of lending allover the world. Lending can be of
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