
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN: 9780190931919
Author: NEWNAN
Publisher: Oxford University Press
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In the figure to the right, the leftward shift from the demand for loanable funds curve DLF, to the demand
for loanable funds curve DLF3, could be the result of
O A. the economy entering a recession.
B. the economy entering an expansion.
O C. a decrease in interest rates during an economic recession.
O D. a government budget surplus.
O E. a increase in interest rates during an economic expansion.
Real interest rate (percent per year)
10
8
6
4
2
0
DLF₁
DLF₂
DLF3
1.5 2.0 2.5 3.0 3.5
Loanable funds (trillions of 2005 dollars)
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- Figure 32-1 percent 8 10 20 30 40 50 60 70 $billions Refer to Figure 32-1. In the Figure shown, if the real interest rate is 6 percent, the quantity of loanable funds demanded is O A. $20 billion, and the quantity supplied is $40 billion. O B. $20 billion, and the quantity supplied is $60 billion. O C. $60 billion, and the quantity supplied is $20 billion. O D. $60 billion, and the quantity supplied is $40 billion.arrow_forward2. Compared to a balanced budget or a budget surplus, what is the effect of a government budget deficit on national saving in the economy? A. National saving is unchanged. OB. National saving decreases. OC. National saving increases. D. National saving could increase or decrease. 3. What is the effect of a budget deficit created by an increase in governmentarrow_forwardSuppose that the demand for loanable funds for car loans in the Milwaukee area is $12 million per month at an interest rate of 1O percent per year, $13 million at an interest rate of 9 percent per year, $14 million at an interest rate of 8 percent per year, and so on. If the supply of loanable funds is fixed at $18 million, what will be the equilibrium interest rate? Instructions: Enter your answer as a whole number. percent per yeararrow_forward
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