In the graph you've just made, what happens if the real interest rate is 4 percent per year?A. The real interest rate rises to 8 percent per year, where there is a surplus of loanable funds.B. The real interest rate fluctuates between 4 and 8 percent per year.C. The real interest rate remains at 4 percent per year.D. There is a shortage of loanable funds and the real interest rate rises to 6 percent per year.Use screenshot attached below to answer the question thanks! At real interest ratesbelow 6 percent a year,the quantity of loanablefunds demanded exceedsthe quantity supplied andthe real interest rate rises.Regardless of whetherthere is a surplus or ashortage of loanable funds,the real interest ratechanges and is pulledtoward an equilibrium level.ⒸResetReal interest rate (percent per year)1210864210Surplus offunds-realinterest ratefallsShortage offunds-realinterest raterises1520Equilibrium253.0SLFDLF13.5

In loanable fund market, the real rate of interest is determined by the intersection of demand and…

In the graph you've just made, what happens if the real interest rate is 4 percent per year? A. The real interest rate rises to 8 percent per year, where there is a surplus of loanable funds. B. The real interest rate fluctuates between 4 and 8 percent per year. C. The real interest rate remains at 4 percent per year. D. There is a shortage of loanable funds and the real interest rate rises to 6 percent per year.

In the graph you've just made, what happens if the real interest rate is 4 percent per year? A. The real interest rate rises to 8 percent per year, where there is a surplus of loanable funds. B. The real interest rate fluctuates between 4 and 8 percent per year. C. The real interest rate remains at 4 percent per year. D. There is a shortage of loanable funds and the real interest rate rises to 6 percent per year.

Brief Principles of Macroeconomics (MindTap Course List)

8th Edition

ISBN:9781337091985

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter8: Savings,investment And The Financial System

Section: Chapter Questions

Problem 5CQQ

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