Principles of Macroeconomics (MindTap Course List)
8th Edition
ISBN: 9781305971509
Author: N. Gregory Mankiw
Publisher: Cengage Learning
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Question
Chapter 13, Problem 5QR
To determine
The impact of change in tax code on private savings and loanable fund market for loanable funds.
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How does an increase in government borrowing affect the equilibrium interest rate in the market for loanable funds?
Usually, when the supply of loanable funds increases, then interest rates
Select one:
a. Might increase or decrease.
b. Increase.
c. Remain unchanged.
d. Decrease.
What impact does the government have in the loanable funds market?
Forces that change the demand for investment in turn impact the demand for loanable funds. These forces include the change of government policies
Chapter 13 Solutions
Principles of Macroeconomics (MindTap Course List)
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- What impact will increases in income have on the Market for Loanable Funds? A) Decrease Supply B) Decrease Demand C) Increase Demand D) Increase Supplyarrow_forwardWhen does the supply of loanable funds increase? The supply of loanable funds increases when disposable income _______ or wealth _______. A. decreases; increases B. decreases; decreases C. increases; increases D. increases; decreases Thanks!arrow_forwardTextbook: Macroeconomics by P. Krugman & R. Wells (5th Edition) Using the accompanying diagram, explain what will happen to the market for loanable funds when there is a fall of percentage points in the expected future inflation rate. How will the change in the expected future inflation rate affect the equilibrium quantity of loanable funds?arrow_forward
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