Exam 23: Finance, Saving, and Investment

Table 23.2.3 The table shows an economy's demand for loanable funds schedule and supply of loanable funds schedule. -Consider Table 23.2.3. If planned investment decreases by $1.0 trillion at each real interest rate, what is the new equilibrium real interest rate?

Table 23.2.2 The table shows an economy's demand for loanable funds schedule and supply of loanable funds schedule. 73)Consider Table 23.2.2. What is the equilibrium real interest rate? -Consider Table 23.2.2. What is the equilibrium quantity of investment?

Table 23.3.5 -Refer to Table 23.3.5. The table shows an economy's demand for loanable funds schedule and supply of loanable funds schedule when the government's budget is balanced. If the government budget surplus is $2.0 trillion, the real interest rate is ________ percent a year, the quantity of investment is ________ trillion, and the quantity of private saving is ________ trillion.

The crowding-out effect refers to

Suppose Canada spends more on foreign goods and services than foreigners spend on our goods and services. Then

Table 23.3.3 -Refer to Table 23.3.3. The table shows the demand for loanable funds schedule and the private supply of loanable funds schedule when the government's budget is balanced. If the Ricardo-Barro effect occurs, and if the government budget deficit is $2.0 trillion, the real interest rate is ________ percent a year and the quantity of investment is ________ trillion.

Table 23.3.4 -Refer to Table 23.3.4. The table shows an economy's demand for loanable funds schedule and the private supply of loanable funds schedule when the government's budget is balanced. If the government budget deficit is $1.0 trillion, the real interest rate is ________ percent a year, the quantity of investment is ________ trillion, and the quantity of private saving is ________ trillion.

In which market would you find mortgage-backed securities?

Suppose the market for loanable funds is in equilibrium. If expected profit falls, the equilibrium real interest rate ________ and the quantity of loanable funds ________.

When the inflation rate is zero, the

A government budget deficit ________ the demand for loanable funds, ________ the real interest rate, and ________ investment.

The Ricardo-Barro effect holds that

National saving equals

If the Ricardo-Barro effect occurs, ________ in private saving finances the government budget deficit, and the real interest rate ________.

Table 23.2.2 The table shows an economy's demand for loanable funds schedule and supply of loanable funds schedule. 73)Consider Table 23.2.2. What is the equilibrium real interest rate? -Consider Table 23.2.2. What is the equilibrium real interest rate?

The real interest rate

Net investment equals

Figure 23.2.4 -In Figure 23.2.4, the economy is at point A on the supply of loanable funds curve SLF₀. What happens if disposable income decreases?

Which of the following explains why the demand for loanable funds is negatively related to the real interest rate?

A decrease in disposable income