Explain how the following will affect • the investment decision, ● the demand for loanable funds and the interest rate in the loanable funds market.

Exploring Economics
8th Edition
ISBN:9781544336329
Author:Robert L. Sexton
Publisher:Robert L. Sexton
Chapter21: Financial Markets, Saving, And Investment
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Question 3 (Topic 6)
Explain how the following will affect
• the investment decision,
the demand for loanable funds and
the interest rate in the loanable funds market.
In your answer refer to the figure provided as appropriate and identify the correct change in
the investment and the interest rate. (Start from point A in Figure 3).
Figure 3 Loanable funds market
interest rate
D
3
A
D2
J
E
ST
Di
D3
barable funds.
Transcribed Image Text:Question 3 (Topic 6) Explain how the following will affect • the investment decision, the demand for loanable funds and the interest rate in the loanable funds market. In your answer refer to the figure provided as appropriate and identify the correct change in the investment and the interest rate. (Start from point A in Figure 3). Figure 3 Loanable funds market interest rate D 3 A D2 J E ST Di D3 barable funds.
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