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gure: Loanable Funds erest ate 6% S D $100 Quantity of loanable fund (billions of dollars n the loanable funds market exhibite ew equilibrium quantity of loanable The government eliminates taxe Profit expectations for business i Capital inflows from foreign citi The federal government runs a b

gure: Loanable Funds erest ate 6% S D $100 Quantity of loanable fund (billions of dollars n the loanable funds market exhibite ew equilibrium quantity of loanable The government eliminates taxe Profit expectations for business i Capital inflows from foreign citi The federal government runs a b

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
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stolt 8 01 10 Macmillan Learning Figure: Loanable Funds Interest rate 0 $100 Quantity of loanable funds (billions of dollars) In the loanable funds market exhibited above, which scenario might produce a new equilibrium interest rate of 8% and a new equilibrium quantity of loanable funds of $75 billion? The government eliminates taxes on income from interest earned. Profit expectations for business investments become less optimistic. Capital inflows from foreign citizens decline. The federal government runs a budget deficit, rather than a surplus.
Transcribed Image Text:stolt 8 01 10 Macmillan Learning Figure: Loanable Funds Interest rate 0 $100 Quantity of loanable funds (billions of dollars) In the loanable funds market exhibited above, which scenario might produce a new equilibrium interest rate of 8% and a new equilibrium quantity of loanable funds of $75 billion? The government eliminates taxes on income from interest earned. Profit expectations for business investments become less optimistic. Capital inflows from foreign citizens decline. The federal government runs a budget deficit, rather than a surplus.
Interest rate 0 S X $100 Quantity of loanable funds (billions of dollars) In the loanable funds market exhibited above, which scenario might produce a new equilibrium interest rate of 8% and a new equilibrium quantity of loanable funds of $150 billion? The federal government has a budget surplus, rather than a budget deficit. Businesses become more optimistic about the return on investment spending. There is an increase in capital inflows from other nations. Consumption as a fraction of disposable income increases.
Transcribed Image Text:Interest rate 0 S X $100 Quantity of loanable funds (billions of dollars) In the loanable funds market exhibited above, which scenario might produce a new equilibrium interest rate of 8% and a new equilibrium quantity of loanable funds of $150 billion? The federal government has a budget surplus, rather than a budget deficit. Businesses become more optimistic about the return on investment spending. There is an increase in capital inflows from other nations. Consumption as a fraction of disposable income increases.
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