The model of the market for loanable funds

Assignment Help Business Economics
Reference no: EM13833930

The model of the market for loanable funds shows that an investment tax credit will cause interest rates and investment to rise. Yet our model of how investors behave claims that higher interest rates lead to lower investment. How can these two opposing statements be reconciled?

Reference no: EM13833930

Questions Cloud

What is the deadweight loss : Managerial economics samuelson and marks 7ed. Chapter 8 questions 8 P=35 - 5Q, where Q is the quantity of microchips in millions. The typical firms total cost of producing a chip is Ci=5qi where qi is the output of firm i. What is the deadweight loss..
What are monopolists profit maximizing price-total output : Demand for microprocessors is given by P=35 - 5Q where Qis quantity of microchips in millions. The typical firm’s total cost of producing a chip is Ci=5qi where qi is the output of firm i. Suppose that one company acquires all the suppliers in the in..
Government action is based on majority rule : Government action is based on majority rule, whereas market action is based on mutual consent. The market allows for proportional representation of minorities, but minorities must yield to the views of the majority when activities are undertaken thro..
What changes to government policy might increase investment : US companies currently have between $1-2 trillion in cash and cash equivalents on hand (although much of it may be in overseas subsidiaries.) Real Gross Private domestic investment in the US still hasn’t recovered to its peak in 2006. What are some o..
The model of the market for loanable funds : The model of the market for loanable funds shows that an investment tax credit will cause interest rates and investment to rise. Yet our model of how investors behave claims that higher interest rates lead to lower investment. How can these two oppos..
Floating exchange rate-what is the impact of monetary policy : Sweden has a floating exchange rate. It is considered that the output is lower than the potential and there is disinflation which sometimes leads to deflation. What can the central bank do in this mode to stimulate the economy? What is the impact of ..
Estimate the process standard deviation : The thickness of a printed circuit board is an important quality parameter. Data on board thickness (in inches) are given in Table 6E.4 for 25 samples of three boards each. (a) Set up and R control charts. Is the process in statistical control? (b) E..
What were the driving factors for change : What systems was in place prior to the selected electronic healthrecord application - what were the driving factors for change
What is the probability that it came from supplier a : The company must also purchase connectors from two other suppliers, 20% from B and the rest from C. The rates of defective connectors from B and C are 2% and 4% respectively. You buy one and find that it is defective. What is the probability that it ..

Reviews

Write a Review

 

Business Economics Questions & Answers

  What is the nature of cross subsidy its extent

What is the nature of cross subsidy, its extent, and its consequences for the pricing of new long distance entrants in comparison to AT&T?

  What is the marginal product of the second employee

What is the marginal product of the second employee. What is the marginal revenue product of the fourth worker.

  A price-weighted index consists of stocks

A price-weighted index consists of stocks A, B, and C which are priced at $38, $21, and $26 a share, respectively. The current index divisor is 2.7. What will the new index divisor be if stock B undergoes a 3-for-1 stock split?

  Measure of expected labor productivity growth

Suppose someone else tells you that even if average real wages or average real compensation per hour increase, economic inequality could increase as well. Is this possible? To judge that overall prospects for a motion, what information might you want..

  Economy be faced with endless trade cycles

Can an economy be faced with endless trade cycles also still have its Real GDP grow over time?

  Which level of measurement conveys the most information

Which level of measurement conveys the most information? Which of the following is NOT an example of reliability? What is one way to obtain a criterion validity measurement?

  Prices in an economy are indexed to increase

Suppose that all wages also prices in an economy are indexed to increase. Explain there can still be an increase tax.

  Developing a new drug-what price do you charge the public

Your firm spent $100 million developing a new drug. It has now been approved for sale, and each pill costs $1 to manufacture. Your market research suggests that the price elasticity of demand in the general public is -1.1. What price do you charge th..

  Plot vanessa budget line by clicking on the two endpoints

Plot Vanessa's budget line by clicking on the two endpoints. The data-plotting tool will automatically connect the points with a line.

  Illustrate what would you expect to happen to costs

If congress took steps to consolidate banks, thereby reducing the total number to 2,500, illustrate what would you expect to happen to costs within the banking industry.

  The traditional mortgage loan structure

Many years ago, the traditional mortgage loan structure specified:

  What is the chart called when the paired data

Twenty randomly selected statistics students were given 15 multiple-choice questions and 15 open-ended questions, all on the same material. The professor was interested in determining on which type of questions the students scored higher.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd