The table below is broken down by Month, Real Interest Rate (%), Loanable of $), Exogenous Change, Equilibria (increases, decreases, or no change. Use the data table to determine the equilibrium real interest rate after certain factors change: Equilibria (increases, decreases, or no change) Month Real Interest Loanable Funds Exogenous Rate (%) (trillions of $) Change no change no change January 3% April 3% 4 increased fund supply 2 decreased fund ? July 4% supply December 3% 3 increased fund ? demand

Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter19: The Macroeconomic Perspective
Section: Chapter Questions
Problem 29P: The prime interest rate is the rate that banks charge their best customers. Based on the nominal...
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Step 2
Determine the equilibrium real interest rate.
The table below is broken down by Month, Real Interest Rate (%), Loanable Funds (trillions
of $), Exogenous Change, Equilibria (increases, decreases, or no change. Use the data table
to determine the equilibrium real interest rate after certain factors change:
Equilibria (increases,
decreases, or no change)
Month
Real Interest
Loanable Funds
Exogenous
Rate (%)
(trillions of $)
Change
3
no change
no change
January
3%
April
3%
4
increased fund
?
supply
decreased fund
July
4%
supply
December 3%
3
increased fund
?
demand
Transcribed Image Text:Step 2 Determine the equilibrium real interest rate. The table below is broken down by Month, Real Interest Rate (%), Loanable Funds (trillions of $), Exogenous Change, Equilibria (increases, decreases, or no change. Use the data table to determine the equilibrium real interest rate after certain factors change: Equilibria (increases, decreases, or no change) Month Real Interest Loanable Funds Exogenous Rate (%) (trillions of $) Change 3 no change no change January 3% April 3% 4 increased fund ? supply decreased fund July 4% supply December 3% 3 increased fund ? demand
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