Using diagrams of the market for capital, determine the effect of the following events on market interest
Question:
a. Consumers increase their saving rate.
b. Advances in nanotechnology reduce firms' costs and increase estimates of future profits.
c. Congress eliminates the tax deductibility of contributions to 401k savings plans.
d. The Federal Reserve floods banks with new money.
e. Banks tighten lending standards.
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a There would be an increase in the supply of capital Interest rates will fall b There would b...View the full answer
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Related Book For
Microeconomics
ISBN: 9781464146978
1st Edition
Authors: Austan Goolsbee, Steven Levitt, Chad Syverson
Question Posted:
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