A country has private saving of $100 billion, public saving of -$30 billion, domestic investment of $50 billion, and net capital outflow of $20 billion. What is its supply of loanable funds?
a. $50 billion
b. $70 billion
c. $90 billion
d. $120 billion
b
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Which of the following does not describe a characteristic of short-term economic fluctuations?
A. Expansions and recessions are irregular in length and severity. B. Durable-goods industries are less sensitive to short-term fluctuations than service and non-durable industries. C. Expansions and recessions are felt throughout the economy. D. The unemployment rate rises during recessions.
By the life-cycle hypothesis, a cyclical boom which causes inflation to accelerate and thus causes people to ________ the real value they estimate their wealth to represent, leads them to ________ the proportion of their current income devoted to
consumption, which turns out to be a ________ influence on the economy. A) lower, reduce, stabilizing B) lower, increase, destabilizing C) raise, increase, stabilizing D) raise, reduce, stabilizing E) raise, reduce, destabilizing
Compared to the GDP deflator, the consumer price index measures:
A) the price of all the goods and services produced in the economy.
B) the price of a fixed market basket of goods and services.
C) the price of exported goods and services.
D) the price of wholesale goods and services.
Why did the lowering of real interest rates during the Great Recession not boost investment spending?
What will be an ideal response?