If the government increases spending by 1% of GDP and the original interest rate was 2%, then the new interest rate is somewhere between 2.5 and what?
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- EqUuil rate= 17% , borrowing by 171 million at old interest rate 15%. compared to value 151 million Question 2. Suppose initially the market for loanable funds is in equilibrium with I*-S*=300 million. Equilibrium interest rate is 1#%. Other things being the same, assume there is a rise in government borrowing by $1#1 million. At the old interest rate (1#%), what would the amount of national saving (S) equal to? What would happen to the interest rate value once the new equilibrium is reached? (Will it change? How?) By how much, you would think that investment (I), national saving, and private saving might change in the new equilibrium (compared to value S1#1 million), and would it be an increase, decrease, or no change? [Use maximum five sentences to clarify vour computations. Type vour answers strietly in the provided space before the nextIn saving drepped sharply in the economy, what would be likely to happen to investiment? WhyInterest 6% lonable fund is 4trillion. Suppose there was a change in the tax laws to encourage savers to save more and as a result, assume the equilibrium interest rate falls by 2 % point. By how much the equilibrium loanable funds saved and invested would rise or fall?
- Suppose the government runs fewer budget deficit and there is a decrease in the average household income. Then, O The new EQ quantity of loanable funds would be indeterminate, , but the new EQ interest rate would increase. O The new EQ quantity of loanable funds would decrease, but the new EQ interest rate would be indeterminate. O The new EQ quantity of loanable funds would be indeterminate, , but the new EQ interest rate would decrease. The new EQ quantity of loanable funds would be indeterminate, but the new EQ interest rate would increase. The new EQ quantity of loanable funds would increase, but the new EQ interest rate would be indeterminate.The table shows the demand for loanable funds schedule and the supply of loanable funds schedule when the govemment budget is balanced. If the government budget deficit is $1.0 trillion, what are the real interest rate, the quantity of investment, and the quantity of private saving? Is there any crowding out in this situation? HEITI If the government budget deficit is $1.0 trillion, the real interest rate is percent a year If the government budget deficit is $1.0 trillion, the quantity of investment is $ trillion, and the quantity trillion. of private saving is $ S Is there any crowding out in this situation? OA. Yes. The deficit increases the real interest rate, which decreases investment. GELOO Real interest rate (percent per year) 4 677997 8 10 4 Loanable funds Loanable funds demanded supplied (trillions of 2012 dollars per year) 8.5 8.0 05 77761 7.5 7.0 6.5 05 6.0 5.5 5.5 6.0 6.5 7.0 7.5 8.0 8.5 6770 00the Savings function of UAE is: S 0.25Y. The Goverment of UAE has spent 100 billion dirham to develop its physical infrastructure. To what extent, UAE's national income will be expanded
- Which would be more difficult to forecast 10 years fromnow: the number of 60-year-olds or their average disposable income? Why?The table shows the demand for loanable funds schedule and the supply of loanable funds schedule when the government budget is balanced. Loanable funds Loanable funds demanded Real interest rate (percent per year) supplied If the govemment budget surplus is $1.0 trillion, what are the real interest rate, the quantity of investment, and the quantity of private saving? (trillions of 2009 dotlars per year) 8.0 6.0 7.5 6.5 If the government budget surplus is $1.0 trillion, the real interest rate is percent a year. 7.0 7.0 6.5 75 If the government budget surplus is S1.0 trillion, the quantity of investment is S trillion, and the quantity of private saving is $ trillion. 6.0 8.0 5.5 8.5 10 5.0 9.0What is national saving? What is privet saving ?what is public saving? How are these three variables related?
- 15. The change in the Personal current taxes from 4th quarter of 2017 to the 4th quarter of 2019 is: ______ billions. 16. he change in the Net federal government saving (budget deficit), from 4th quarter of 2017 to the 4th quarter of 2019 is: ______ billions.What is a government budget deficit? How doesit affect interest rates, investment, and economicgrowth?A mortgage 105m is a loan that a person makes to purchase a house. Table 19.11 provides a list of the mortgage interest rate for several different years and the rate of inflation for each of those years. In which years would it have been better to be a person borrowing money from a bank to buy a home? In which years would it have been better to be a bank lending money?