Given the information in the preceding tables, use the blue points (circle symbol) to plot the demand for loanable funds. Next, use the orange points(square symbol) to plot the supply of loanable funds. Finally, use the black point (cross symbol) to indicate the equilibrium in this market.?INTEREST RATE (Percent)• #Market for Loanable Funds25 50 35 100 125 150 175 200 225QUANTITY OF LOANABLE FUNDS (Bilions of dollars)EquilibriumIf the interest rate is 3%, then the quantity of loanable funds supplied would bepressure on the equilibrium interest rate.than the quantity demanded, putting27 The following tables present a hypothetical economy's data on the relationship between various real interest rates and sector-specific supply anddemand for loanable funds, where the currency is the U.S. dollar.Real InterestRate(Percent)765432Real InterestRate(Percent)76532HouseholdSupply(Billions ofdollars)555040353025HouseholdDemand(Billions ofdollars)152540505570BusinessSupply(Billions ofdollars)5550252520inBusinessDemand(Billions ofdollars)51525404560Federal GovernmentSupply(Billions of dollars)ssssss555555Federal GovernmentDemand(Billions of dollars)555555Foreign InvestorSupply(Billions ofdollars)555025251510Foreign InvestorDemand(Billions ofdollars)24498101525405060MunicipalGovernment Supply(Billions of dollars)30251515105MunicipalGovernment Demand(Billions of dollars)51015202530

The demand for loanable funds comes from borrowers, such as individuals, firms, or the government,…

Answered: If the interest rate is 3%, then the…

If the interest rate is 3%, then the quantity of loanable funds supplied would be i pressure on the equilibrium interest rate. than the quantity demanded, putting

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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Question

100%

Given the information in the preceding tables, use the blue points (circle symbol) to plot the demand for loanable funds. Next, use the orange points
(square symbol) to plot the supply of loanable funds. Finally, use the black point (cross symbol) to indicate the equilibrium in this market.
?
INTEREST RATE (Percent)
• #
Market for Loanable Funds
25 50 35 100 125 150 175 200 225
QUANTITY OF LOANABLE FUNDS (Bilions of dollars)
Equilibrium
If the interest rate is 3%, then the quantity of loanable funds supplied would be
pressure on the equilibrium interest rate.
than the quantity demanded, putting
27

The following tables present a hypothetical economy's data on the relationship between various real interest rates and sector-specific supply and
demand for loanable funds, where the currency is the U.S. dollar.
Real Interest
Rate
(Percent)
7
6
5
43
2
Real Interest
Rate
(Percent)
7
6
5
3
2
Household
Supply
(Billions of
dollars)
55
50
40
35
30
25
Household
Demand
(Billions of
dollars)
15
25
40
50
55
70
Business
Supply
(Billions of
dollars)
55
50
25
25
20
in
Business
Demand
(Billions of
dollars)
5
15
25
40
45
60
Federal Government
Supply
(Billions of dollars)
ssssss
5
5
5
5
5
5
Federal Government
Demand
(Billions of dollars)
555555
Foreign Investor
Supply
(Billions of
dollars)
55
50
25
25
15
10
Foreign Investor
Demand
(Billions of
dollars)
24498
10
15
25
40
50
60
Municipal
Government Supply
(Billions of dollars)
30
25
15
15
10
5
Municipal
Government Demand
(Billions of dollars)
5
10
15
20
25
30

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