Using supply and demand diagrams representing the market for loanable funds, show and explain the effect on the equilibrium interest rate and quantity of loanable funds in the following events. Each event is treated independently: a) A reduction in government spending b) a change in tax laws that encouraged households to save more
Q: What is the dead-weight loss? Question 7 options: None of the other answers is correct The…
A: A dead weight loss can be defined as the cost to society created by market inefficiency, which…
Q: 3 Explain the benefits of gaining international business experience and working as an expat
A: A business is a firm that buys or sells goods and services at the market price in the market. It…
Q: 2. (a) Using your knowledge of the circular flow of income and interpreting the data given above,…
A: The circular flow of income shows the major exchanges of the flow of income, goods, and services,…
Q: Assume the $11,700 Treasury bill, 6% for 10 weeks. Calculate the effective rate of interest. (Use…
A: Effective annual interest rate usually refers to the actual/real return on a savings account or…
Q: Figure 2 shows the payments and revenues of a small project. If M.R.R.R=%12, Evaluate the project…
A:
Q: If P10,000 is deposited each year for 9 years, how much annuity can a person get semi-annually from…
A: Compound interest, also known as Interest on Interest, is interest that is added to the interest…
Q: Use the payoff matrix to answer the following questions Apple Advertise (6,6) Samsung Advertise Not…
A: Given, Apple Samsung Advertise Not advertise Advertise 6,6 10,1…
Q: Assume the demand for a particular product is given by p = 120 - q and firms produce at linear costs…
A: Answer = "Thank you for submitting the question. But, we are authorized to solve only 3 subparts .…
Q: In Camarillo, if the equilibrium price of cooking oil is $5.90 per pound, and if the government…
A: When talking about price floor, it is the minimum price of a good set by the government to protect…
Q: Economists refer to the conflict between the interests of shareholders and the interests of top…
A: Different parties have different interests in a particular organization.
Q: D). Suppose that you are a buyer, based on your preferences and other things being equal, would you…
A: When talking about elasticity of demand, elasic demand is when a percentage change in price will…
Q: 8. Mary Catacutan and Pedro Perez are considering the possibility of teaching swimming to kids…
A: Answer: Let us derive the cost function first for Mary and Pedro: Fixed cost FC=₱1,700Variable cost…
Q: Questions 1.4 and 1.5 refer to a consumer with preferences over food (x) and clothing (y)…
A: The consumer price index (CPI) is a broad indicator for evaluating price changes in a basket of…
Q: State whether each of the following events involves a financial inflow to or outflow from the Kenyan…
A: Financial flow refers to the flow of money in any form from one place to another. It could be in the…
Q: In March 2021, sales of disposable flavored e-cigarettes were 8.25 million devices. The average…
A:
Q: 14. A set of data with a correlation coefficient of -0.855 has a a. moderate negative linear…
A: Ans. 14. A correlation coefficient is a statistical measure that shows the linear relationship…
Q: Name any item that is a store of value, but does not serve the other functions of money. Explain…
A: The ability of a commodity to be held and then used in the future is referred to as the store of…
Q: of copies Foothill Bookstore can sell each week if it sets the price a when the price is set to $40…
A: *Answer:
Q: 1. Looking at the market for Sacramento Kings Coffee Mugs: Draw supply and demand curves that follow…
A: Since you have posted multiple questions, we will solve the first question for you. If you want any…
Q: Example [2] & Consider a scenario where you deposited a $1,000 in a savings account that pays $500…
A: PV = 1000 Bank Pays 500 in 3rd Year and 1500 in 5th Year
Q: Remembering the learning activity in Unit 3, the Gondwanaland chairman of production reported that…
A: The measure that depicts percentage change in quantity being demanded with respect to change in…
Q: Evaluate the extent to which Livestock Wealth is implementing the concepts of “shared value” and…
A: Shared value means that the businesses are adopting those practices that help in increasing the…
Q: Suppose the market operates under perfect competition without the innova- tion. (i) Write down the…
A: Introduction We have given a demand and cost function. Cost function differs when firm adopt a new…
Q: C). Suppose that the equilibrium price for this product is $4 and the equilibrium quantity is 100…
A: Note: We will answer the first question as the exact one was not specified. Please resubmit a new…
Q: Outline the characteristics of a perfect competition market that makes it different from an…
A: "In an economy there are different market structures. Market structure depicts how various…
Q: Questions 1.4 and 1.5 refer to a consumer with preferences over food (x) and clothing (y)…
A: Inflation means the rise in the price level of goods and services over a period of time. The rise in…
Q: 4. If two countries produce very similar goods, but with different costs of production in each…
A: Since you have asked multiple questions, we will solve the first question for you. If you want any…
Q: The Ylaya Textile Mill produces denim. The fixed monthly cost is P21,000, and the 2. variable cost…
A: Given information, Monthly fixed cost: P21,000 Variable cost per yard: P0.45 Sales price per yard:…
Q: Partial equilibrium effects of import quota: large country Can you show that with the graph?
A: The concept "partial equilibrium" refers to a study that only considers the effects of a policy…
Q: Why was there such a concern in the second half of the 20th century with reducing military weaponry,…
A: Nuclear weapons are lances of mass annihilation; in contrast to conventional fighting, nuclear…
Q: Examples of form utility
A: Utility is defined as the complete satisfaction a customer gets from using a product or service.…
Q: an entrepreneur is setting up a storage facility which will provide storage both at peak times and…
A: For Kuhn - Tucker conditions of optimization we set up a Lagrangian problem in which there is an…
Q: Politicians claim that the increased price of gasoline is a problem and to solve it we must increase…
A: An economic problem is any issue in the economy that involves the creation of products and services…
Q: Question 6 You are making a bid to take over a company that George currently owns and controls.…
A: Following matrix states the value of company under two conditions : Good or bad & also under…
Q: Draw the following situations as a graph format: 1. The graph will have the price (P) on the y-axis…
A: The fact of externalities in production and consumption also direct to market failure. Externalities…
Q: The maintenance cost of a certain equipment is P40,000 per year for the first 5 years, P60.000 per…
A: Given the information: Interest rate = 6% Maintenance cost per year till 5th year = P40000…
Q: Bob X Y X (1,1) (0,2) Ann Y (2,0) (0,0)
A: Game theory is a technique or method of formal economic reasoning that is used to examine situations…
Q: Q2. Determine the returns to scale of the following production function: Hand written plzz Y = 5K0.5…
A: Returns to scale: - returns to scale show the change in output due to the change in scale of…
Q: This is the answer plz write Clear hand written Y=5kº5 +32° Multiply k & L by X s(kjt3 CLOS 0.5 0.5…
A: As asked by the student. Written and clearly scanned this question.
Q: equipment that cost Php. 7,000 has an economic life of n years and a salvage value of Php. 350 at…
A: Given information: Cost of equipment = Php 7000 Economic life = n years Salvage value = 350 Book…
Q: Questions 1.4 and 1.5 refer to a consumer with preferences over food (x) and clothing (y)…
A: Inflation means the rise in the price level of goods and services over a period of time. The rise in…
Q: What happens to the equilibrium price when there is an increase in demand and a decrease in supply…
A: The equilibrium price is the most effective rate in which the plans of purchasers and the plans of…
Q: Suppose a closed economy has an intended investment of 100 and an aggregate consumption function…
A: Given information: C=250 + 0.75Yd -----> Consumption function I = 100 ------------> Investment…
Q: in what is the capitalized worth when 1 = 10% per year of 3500$ per year starting one year and…
A: * SOLUTION :-
Q: Explain Discriminatory Monopolistic Market Equilibrium and draw diagrams
A: The discriminatory monopolistic market equilibrium can be better understood if we understand a…
Q: 3. The intelligence test scores and freshmen physics grades of a group of students are given in the…
A: Regression refers to a statistical technique used in finance, investing, and other fields to…
Q: An incumbent firm Pilly has a product that works well but has the possibility of causing…
A: We have game between two players, they both have same set of actions invest and don't invest.
Q: The bank is paying 11.29% compounded annually. The inflation is expected to be 12.22% per year. What…
A: When talking about market interest rate, it is the rate at which people are ready to exchange money…
Q: The Mandaue Furniture produces tables. The fixed monthly cost of production is P8,000, and the…
A: The total expenses that are being incurred by a business in the production of a service or product…
Q: If the interest rate for housing loan rise from 4% to 8%, but the expected rate of increase in…
A: * SOLUTION :- Given that , the interest rate for housing loan rise from 4% to 8% the expected rate…
Step by step
Solved in 2 steps with 2 images
- The loanable funds model suggests that increased government spending, financed by borrowing, will cause business nvestment to and household saving to Select one: O a increase, increase Ob increase; decrease Oc decrease, increase Od decrease; decreaseWhich of the following reasons could cause the demand curve for loanable funds to shift to the right from DLF to D¹LF in the figure? Wage $11 8 X 3400 2700 D 4500 Quantity of labor The economy is expected to boom, thereby increasing investment returns. O Larger investment projects with potentially higher returns get funded. Falling interest rates make it less expensive for firms to borrow. Rising interest rates make it more attractive for savers to save.In the market for loanable funds, the equilibrium interest rate is 3% and the equilirbium quantity of loanable funds is $500 billion.What's the likely result if bamks offer loans for an interest rate of 5%? a) the quantity of loans supplied by banks will be greater than the quantity of loans demanded from potential investors b) the government will issue more bonds to make up for the decreased number of loans c) there'll be an increase in borrowing d) the quantity of loanable funds demanded will increase
- Interest Rate 0 Multiple Choice O O A O S₁ BC Quantity Refer to the diagram. Suppose that the demand for loanable funds is D₁ and the supply of loanable funds initially is S₁. If the supply of loanable funds increases to So, the equilibrium quantity of funds borrowed will increase from E to F. increase from A to B. increase from B to C. So decrease from G to F. Do D₁↑ Match each of the following scenarios with the appropriate graph of the market for loanable funds. NEAL Loanable funds Loanable funds 292 D₁ D₂ Loanable funds Loanable funds a. An increase in the real interest rate results in only a small increase in private saving by households. This matches graph b. A decrease in the real interest rate results in a substantial increase in spending on investment projects by businesses. This matches graph c. The federal government eliminates RRSPs and TFSAS (tax-deductible retirement accounts). This matches graph d. The federal government reduces the tax on corporate profits. (Assume no change in the federal budget deficit or budget surplus.) This matches graphAccording to how we model the Loanable Funds market in Ch. 6 (considering household savings and taking (T – G) as government’s net ‘saving,’ which could be negative it there were a budget deficit), which of the following shifts the Supply of Loanable Funds curve to the left? (T = taxes; G = government spending.) Group of answer choices A) higher tax rates on business investment spending B) a change in tastes toward consuming less C) higher budget deficit D) change in tastes toward saving more E) lower budget deficit
- Using the graph of the loanable funds market below, if the supply of loanable funds increases from SFL and the demand for loanable funds increases from DLF, then the equilibrium interest rate will D'LF DuF Qo Q. Q2 QuF decrease to i2. O remain at i0. increase temporarily and then decrease. O increase to i1.Use the graph to answer the question that follows. Real interest rate % r Dif q q' Quantity of loanable funds $ The graph shows a change in an economy after the government's decision to provide tax benefits to businesses in an effort to increase investment. What is the new point of equilibrium in the economy's loanable funds market? O o Or O o O q Or o' Sif D'IfRecently, the economies of North Korea and Norway have begun to grow very rapidly. This increases their citizens’ income and wealth as well. In turn, these citizens increase their savings not only in their country, but also in the United States. In this case, which of the following statements is correct? A. The supply of loanable funds decreases as savings increase. B. The supply of loanable funds increases as savings increase. C. The demand of loanable funds decreases as savings increase. D. Both supply and demand of loanable funds increase as savings increase.
- Indicate the Quantity demanded and Quantity supplied of loanable funds if the Interest rates increases by 2% (from the equilibrium rate). would changed in interest rate cause a movement along the curve or shift? Interest rate 24% 22 20 ' 18 16 14 12 10 a 6 4 2 Y S ° $200 $400 600 D 800 1,000 1,200 Quantity of leanable funds (billions of dollars) Indicate the Quantity demanded and Quantity supplied of loanable funds if the Interest rates increases by 2% (from the equilibrium rate). would changed in interest rate cause a movement along the curve or shift?Recently, the economies of North Korea and Norway have begun to grow very rapidly. This increases their citizens’ income and wealth as well. In turn, these citizens increase their savings not only in their country, but also in the United States. In this case, which of the following statements is correct? A. The supply of loanable funds decreases as savings increase. B. The supply of loanable funds increases as savings increase. C. The demand of loanable funds decreases as savings increase. D. Both supply and demand of loanable funds increase as savings increase. Clear my choiceDraw the diagram for the loanable funds model. Suppose the tax laws are altered to providemore incentives for private saving (assume that total tax revenue T does not change). Whathappens to the interest rate and investment?