Samantha decides to withdraw $10,000 from her savings account and invest it all in the stock market. Her total economic costs
A) equal $10,000.
B) are independent of the interest she enjoyed in her savings account.
C) are affected by the interest she enjoyed in her savings account.
D) are determined solely by the commission she is charged for the purchase of stock.
C
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The equilibrium real interest rate is 5 percent. If the real interest rate is
A) anything other than 5 percent, the supply of loanable funds curve and/or the demand for loanable funds curve will shift to move the real interest rate to 5 percent. B) 6 percent, the demand for loanable funds curve will shift rightward as firms enter the market to borrow at the lower rate. C) 2 percent, there is a shortage of loanable funds. D) 8 percent, there is a surplus of loanable funds. E) 3 percent, then the supply of loanable funds curve will shift leftward as new savers enter the market.
Use the data in the Worked Problem on p. 287 (page 699 in Economics). Calculate the change in equilibrium expenditure when investment decreases by $150 billion
What will be an ideal response?