Automated Case Info... M Inbox (1,419) - singh... G The Remarkable Rebi... Take Test: ECO 201-1... Home Take Test: ECO 201-1800 Test 3 Question Completion Status: 14 Moving to the next question prevents changes to this answer. Question 22 Question 22 of 25 4 points Save Answer The Market for Loanable Funds II. Other things being equal, a decrease in taxes on savings and investment income will shift, to the and the interest rate. Interest rate r* = 6% E Supply Demand 0 Q* = 500 Quantity of loans a. supply; right; decrease b. demand; right; increase c. demand; left; decrease d. supply; left; increase Moving to the next question prevents changes to this answer. APR 20 Question 22 of 25 t

Automated Case Info... M Inbox (1,419) - singh... G The Remarkable Rebi... Take Test: ECO 201-1... Home Take Test: ECO 201-1800 Test 3 Question Completion Status: 14 Moving to the next question prevents changes to this answer. Question 22 Question 22 of 25 4 points Save Answer The Market for Loanable Funds II. Other things being equal, a decrease in taxes on savings and investment income will shift, to the and the interest rate. Interest rate r* = 6% E Supply Demand 0 Q* = 500 Quantity of loans a. supply; right; decrease b. demand; right; increase c. demand; left; decrease d. supply; left; increase Moving to the next question prevents changes to this answer. APR 20 Question 22 of 25 t

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter21: Financial Markets, Saving, And Investment

Section: Chapter Questions

Problem 9P

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Similar questions

Suppose government provides tax rebate to small business on their business-related expenditure. Assuming no change in government budgetary position, this policy is likely to have a positive effect on household (or private) saving in the economy (Hint: think about the effect of this policy in Loanable Funds Market) Is this statement true, false or uncertain? Please provide your explaination.
According to how we model the Loanable Funds market in Ch. 6 (considering household savings and taking (T – G) as government’s net ‘saving,’ which could be negative it there were a budget deficit), which of the following shifts the Supply of Loanable Funds curve to the left? (T = taxes; G = government spending.) Group of answer choices A) higher tax rates on business investment spending B) a change in tastes toward consuming less C) higher budget deficit D) change in tastes toward saving more E) lower budget deficit
If Net Investment = 0 in a given year, this indicates that we have neither lost nor gained capital. That seems to be a desirable outcome. Do you agree?
The saving rate (gross domestic saving as a % of GDP) in Australia, a small open economy, was 15% in 2011 while the investment rate (domestic investment as a % of GDP) was 25%. As a result, there was net outflow of capital from Australia in 2011. Is this true, false or uncertain? Please provide your explaination.
Why, other things remaining the same, does a rise in the real interest rate decrease the quantity of loanable funds demanded? The quantity of loanable funds demanded decreases because at a higher interest rate _______. A. fewer projects have an expected rate of profit below the real interest rate B. more projects have an expected rate of profit that exceeds the real interest rate C. banks want to lend more D. fewer projects have an expected rate of profit that exceeds the real interest rate
Suppose the economy is closed and consumption of $10,000, taxes are $2000 and government purchases are $3,000 and national saving is $1,500. (Given GDP=$14500, Public saving= -$1000, Private saving=$2500, Investment=$1500). So In the era of covid-19 pandemic, the producers were pessimistic about the returns of capital and reduced their investments. Use a well-labelled diagram of loanable funds market to illustrate and explain the impacts on the equilibrium interest rate and quantity of loanable funds.
Suppose the long-term real interest falls. In the (private sector) loanable funds market. the result will be. a. the demand for loanable funds curve shifts to the right b. the supply of loanable funds curve shifts to the left c. the demand for Ioanable funds curve does not shift to the right nor does the supply of loanable funds cunve shift to the left d. the demand for loanable funds curve shifts to the right and the supply of loanable funds curve shifts to the left
Show graphically how an increase in household confidence about future income affects the loanable funds market. Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
Use the analysis for the market for loanable funds diagrams to examine and explain both in words anddiagrammatically how the following government policy affect the economy’s saving and investment.Policy 1: Suppose the government passed a tax reform giving an investment tax credit to any firmbuilding a new factory or buying a new piece of equipment
After reading the given descriptions, please place the correct label by the quadrant on the graph that best describes each person's position in the market for loanable funds. Jolien decides not to take out a loan to fund expanding her grocery store because she projects it will only earn a return of 4%4%. Osi closely follows the market for United States Treasury Bonds. He is willing to invest in them anytime the rate of return is 5%5% or higher, and sees that this is the case. In order to open a new car wash facility expected to return 13%13%, Julius secures a loan. John will shift his stock investments to corporate bonds when they return at least 10%10%. They do not, so he stays with stocks
True/False and Explain If the real rate of return on investment is higher in the US than in Canada, capital will tend to flow out of the US and into Canada.
Suppose Wonderland is a closed economy with a consumption function of C =500 + 0.6 x (Y-T).Recently, a legislator proposes to raise the expenditure on infrastructure.How would this affect national saving, real interest rate and investment inWonderland in the long run? Explain using the concept of loanable fund market.