Vertical axis and quantity of loanable fund

Assignment Help Business Economics
Reference no: EM131107861

Analyse the effects of the following events in the loanable fund market diagram where we have (real) interest rate (r) on the vertical axis and the quantity of loanable fund (Q) on the horizontal axis. Please ensure to explain what happens to private saving, private investment spending, and (real) interest rate, and demonstrate it changing a figure below.

a) An increase in government purchases

b) Australian business becomes very optimistic about the future course of the economy and this increases the prospect of their profitability at any given (real) interest rate. Assume the government budget balance is zero.

c) A decrease in the income tax rate.

Reference no: EM131107861

Questions Cloud

Economic consultant to price-taking firm : You’ve been hired as an economic consultant to a price-taking firm that produces shirts. The firm already has a shirt factory, so it is operating in the short run. The price of shirts is $5, the hourly wage is $12, and each shirt requires $1 worth of..
What ways borrowing from abroad shape european civilizations : In what ways did borrowing from abroad shape European civilizations after 1000, How did the links to Byzantium transform the new civilization of Kievan Rus
Problem regarding the unemployment and inflation : What is the relationship between unemployment and inflation has stated in economics.
Which topics would be prohibited from a media statement : Under the Model Rules, which of the following topics would be prohibited from a media statement? Which of the following statements regarding judicial behavior is true?
Vertical axis and quantity of loanable fund : Analyse the effects of the following events in the loanable fund market diagram where we have (real) interest rate (r) on the vertical axis and the quantity of loanable fund (Q) on the horizontal axis. An increase in government purchases. A decrease ..
How much farther did you walk than jog : If you walk 8/9 miles and then jog 1/2 mile, what is the total distance covered? How much farther did you walk than jog?
Example of fields they cover : Discuss two branches of economics giving example of fields they cover?
Importance and patterns of expansion of empires : Importance and patterns of expansion and contraction of empires, religions, trade that influenced regional cultures through the decline of the Roman Empire
Harvesting web data : Every time you do an internet search, information is past from you to the server. In between the information exchange, advertisers pay for data so they can display content related to the searches you are performing.

Reviews

Write a Review

 

Business Economics Questions & Answers

  What challenges did you face

If you have been employed in an organization that has gone through bald ridge or ISO process, share your experiences. What challenges did you face.

  Calculate the excess burden resulting from this tax

the government implements a 25% tax on labor income as a way to raise revenue. Calculate the excess burden resulting from this tax, and illustrate your answer with a graph

  What will happen to real gdp and to amount of labor employed

What will happen to real GDP and to the amount of labor employed, aggregate consumption, and aggregate savings? Compare these results to those predicted by the equilibrium business cycle model developed by Barro throughout the text.

  Expected to generate fixed annual cash flows

What is the value of a building that is expected to generate fixed annual cash flows of 89,550 dollars every year for a certain amount of time if the first annual cash flow is expected in 5 years from today and the last annual cash flow is expected i..

  If economy-wide productivity and the average wage each rise

Suppose demand conditions in industries X and Y are identical but that productivity increases by 5% in industry X and 2% in industry Y. If economy-wide productivity and the average wage each rise by 3%, we should expect that:

  Compute the upper also lower limits which marginal cost

Compute the upper also lower limits within which marginal cost may vary without affecting the profit maximizing output or the price.

  Does player have a dominant policy

Does player 1 have a dominant policy also if so Illustrate what is it or does player 2 have a dominant policy also if so Illustrate what is it.

  Q1 total fixed cost or sunk cost is independent of quantity

q1. total fixed cost or sunk cost is independent of quantity produced.assume a small firm has invested 10 million in

  Fixed amount of final output period forever war reparations

Assuming that the economy begins from a static equilibrium, consider how the economy responds to the following shocks. Please plot the responses within the phase diagram, and use separate graphs to show the trajectories of k and c over time. What if ..

  What do economists call the percentage change in real gdp

Illustrate what do economists call the percentage change in real GDP from year to the next. Under a business agreement 70/30 why should the 70% shareholder decision carry all day.

  How much of each good will he demand

Edmund has the utility function U(x, y) = 2xy + 1. The prices of x and y are both $1 and Edmund has an income of $20. How much of each good will he demand? A tax is placed on x so that it now costs Edmund $2 while his income and the price of y stay t..

  Equations for government budget balance-market clearing

Consider a static (one-period), closed economy with one representative consumer, one representative firm, and a government. The level of capital K and government expenditures G in the economy are both fixed exogenously. Formally define a competitive ..

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