If at some interest rate desired investment is $400 billion, desired private saving is $600 billion, and the budget deficit is $300 billion, is there a surplus or a shortage in the market for loanable funds? What does this imply would happen to interest rates?
There is a shortage. The interest rate will rise.
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If both supply and demand simultaneously decrease
A) the market clearing price definitely rises, and the equilibrium quantity definitely falls. B) the market clearing price definitely rises, and the effect on the equilibrium quantity is indeterminate. C) the market clearing price definitely falls, and the effect on the equilibrium quantity is indeterminate. D) the effect on the market clearing price is indeterminate, and the equilibrium quantity definitely falls.
GDP per capita is a relatively good measurement of:
a. the distribution of income. b. purchasing power. c. household production. d. the standard of living.
Monetarists believe that changes in the supply of money
A) do not affect aggregate demand. B) affect aggregate demand through the loanable funds market only. C) affect only the investment component of aggregate demand. D) affect aggregate demand directly.
A monopolist's marginal revenue curve is
A. the same as a perfectly competitive firm's marginal revenue curve. B. higher than the monopolist's demand curve. C. a horizontal line at the market price. D. below the firm's demand curve.