Question: The question relates to the payments system Question 4 - The payments system (10 points). Suppose the old bankers in the cen tral island own

The question relates to the payments system

Question 4 - The payments system (10 points). Suppose the old bankers in the cen tral island own $5, 000, 000 of at money and creditors are owed $7, 500,000. 1. Compute the price at which creditors Will be able to sell the debt they own. 2. How much interest Will a bank be Willing to pay after the the debtors have arrived in order to have one more dollar of at money? 3. Suppose the central bank is Willing to purchase $2, 000, 000 worth of debt. What Will the price of debt be in that case

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