If, at the current interest rate, the quantity of loanable funds supplied is less than the quantity of loanable funds demanded, then
A) the supply of loanable funds curve shifts leftward and the real interest rate rises.
B) the real interest rate falls.
C) the supply of loanable funds curve shifts leftward and the real interest rate falls.
D) the real interest rate rises.
E) the supply of loanable funds curve shifts rightward and the real interest rate rises.
D
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Assume that the expectation of a recession next year causes business investments and household consumption to fall, as well as the financing to support it. If the nation has low mobility international capital markets and a fixed exchange rate system, what happens to the quantity of real loanable funds per time period and real GDP in the context of the Three-Sector-Model?
a. The quantity of real loanable funds per time period falls and real GDP falls. b. The quantity of real loanable funds per time period falls and real GDP rises. c. The quantity of real loanable funds per time period rises and real GDP remains the same. d. The quantity of real loanable funds per time period and real GDP remain the same. e. There is not enough information to determine what happens to these two macroeconomic variables.
If the CPI was 102.4 in Year 1 and was 105.7 for Year 2, then the rate of inflation between Year 1 and Year 2 was:
(a) 2.2%. (b) 3.2%. (c) 4.2%. (d) We need more information to calculate it.