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Illustrate Graphically How the Equilibrium Quantity of Credit and Real

Question 10

Essay

Illustrate graphically how the equilibrium quantity of credit and real rate of interest will change from an initial equilibrium if:
a)credit demand decreases at the initial equilibrium rate of interest.
b)credit supply increases at the initial equilibrium rate of interest.

Correct Answer:

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The equilibrium in the credit market is ...

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