The table above shows the supply of loanable funds and the demand for loanable funds schedules
a. What is the equilibrium real interest rate and the equilibrium quantity of loanable funds?
b. If the real interest rate is 4 percent, is there a shortage or surplus? What will happen in the market?
a. The equilibrium real interest rate is 6 percent and the equilibrium quantity of loanable funds is $11 billion.
b. If the real interest rate is 4 percent, there is a shortage of loanable funds. The shortage means that the quantity of funds demanded for investment exceeds the quantity supplied, so the real interest rate will rise to its equilibrium of 6 percent.
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The fact that output gaps will not last indefinitely, but will be closed by rising or falling inflation is the economy's:
A. income-expenditure multiplier. B. self-correcting property. C. short-run equilibrium property. D. long-run equilibrium property.
The table below shows the weekly supply for hamburgers in a market where there are just three sellers.PriceSeller 1 Qs 1Seller 2 Qs 2Seller 3 Qs 3$5854464334322221Refer to the above table. If the price of a hamburger falls from $5 to $4, then the weekly market quantity of hamburgers supplied will
A. increase from 9 to 17. B. increase from 13 to 17. C. decrease from 17 to 9. D. decrease from 17 to 13.
Refer to Table 8-8. Suppose that a simple economy produces only four goods and services: sweaters, CDs, sugar, and soft drinks
Assume one half of the sugar is used in making the soft drinks and the other half of the sugar is purchased by households. Calculate nominal GDP for this simple economy.
When a firm sells products at lower prices to foreign purchasers, it is known as:
a. international dumping. b. restraint of trade. c. price gouging. d. reciprocal dumping.