The shift of equilibrium position in loanable market.

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Answer 1

Question

Chapter 21, Problem 21.2.12PA

Sub part (a):

To determine

The shift of equilibrium position in loanable market.

Sub part (b):

To determine

The shift of equilibrium position in loanable market.

Sub part (c):

To determine

The shift of equilibrium position in loanable market.

Sub part (d):

To determine

The shift of equilibrium position in loanable market.

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In the graph you've just made, how does a tax on interest income influence the real interest rate and investment? A tax on interest income _______ loanable funds, which _______ the real interest rate and _______ investment. A. decreases the demand for; raises; decreases B. decreases the supply of; raises; decreases C. increases the supply of; lowers; increases D. increases the demand for; lowers; increases Screenshot attached thanks

Use the loanable funds market to illustrate the effect of the following events on the equilibrium. Illustrate the effects on the interest rate and quantity of investment-savings a) The proportion of retired people in the population goes up. Think that usually retired people generally save less than working people at any interest rate. b) At any given interest rate, consumers decide to save more (assume the budget balance is zero). c) At any given interest rate, businesses become very optimistic about the future profitability of investment spending (assume the budget balance is zero).

Draw a graph to illustrate the effect of an increase in the demand for loanable funds and an even larger increase in the supply of loanable funds on the equilibrium quantity of loanable funds and the real interest rate.

Answer 2

Question

Chapter 21, Problem 21.2.12PA

Sub part (a):

To determine

The shift of equilibrium position in loanable market.

Sub part (b):

To determine

The shift of equilibrium position in loanable market.

Sub part (c):

To determine

The shift of equilibrium position in loanable market.

Sub part (d):

To determine

The shift of equilibrium position in loanable market.

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Answer 3

Question

Chapter 21, Problem 21.2.12PA

Sub part (a):

To determine

The shift of equilibrium position in loanable market.

Sub part (b):

To determine

The shift of equilibrium position in loanable market.

Sub part (c):

To determine

The shift of equilibrium position in loanable market.

Sub part (d):

To determine

The shift of equilibrium position in loanable market.

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Answer 4

Question

Chapter 21, Problem 21.2.12PA

Sub part (a):

To determine

The shift of equilibrium position in loanable market.

Sub part (b):

To determine

The shift of equilibrium position in loanable market.

Sub part (c):

To determine

The shift of equilibrium position in loanable market.

Sub part (d):

To determine

The shift of equilibrium position in loanable market.

Expert Solution & Answer

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Answer 5

Chapter 21, Problem 21.2.12PA

Sub part (a):

To determine

The shift of equilibrium position in loanable market.

Sub part (b):

To determine

The shift of equilibrium position in loanable market.

Sub part (c):

To determine

The shift of equilibrium position in loanable market.

Sub part (d):

To determine

The shift of equilibrium position in loanable market.

Answer 6

Chapter 21, Problem 21.2.12PA

Sub part (a):

To determine

The shift of equilibrium position in loanable market.

Answer 7

Chapter 21, Problem 21.2.12PA

Sub part (a):

To determine

The shift of equilibrium position in loanable market.

Answer 8

Sub part (b):

To determine

The shift of equilibrium position in loanable market.

Answer 9

Sub part (b):

To determine

The shift of equilibrium position in loanable market.

Answer 10

Sub part (c):

To determine

The shift of equilibrium position in loanable market.

Answer 11

Sub part (c):

To determine

The shift of equilibrium position in loanable market.

Answer 12

Sub part (d):

To determine

The shift of equilibrium position in loanable market.

Answer 13

Sub part (d):

To determine

The shift of equilibrium position in loanable market.

Answer 14

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Answer 15

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Answer 16

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Answer 17

Ch. 21 - Prob. 21.1.1RQ Ch. 21 - Prob. 21.1.2RQ Ch. 21 - Prob. 21.1.3RQ Ch. 21 - Prob. 21.1.4RQ Ch. 21 - Prob. 21.1.5PA Ch. 21 - Prob. 21.1.6PA Ch. 21 - Prob. 21.1.7PA Ch. 21 - Prob. 21.1.8PA Ch. 21 - Prob. 21.1.9PA Ch. 21 - Prob. 21.1.10PA

The shift of equilibrium position in loanable market.

Solution Summary: The author explains the shift in the equilibrium position of the loanable fund. When the interest rate increases, the quantity demanded increases from L1 to L3.

The shift of equilibrium position in loanable market.

The shift of equilibrium position in loanable market.

The shift of equilibrium position in loanable market.

The shift of equilibrium position in loanable market.

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Chapter 21 Solutions