In the Stiglitz and Weiss (1981) model (Section 3.4), when perfect competition in the deposit market forces
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In the Stiglitz and Weiss (1981) model (Section 3.4), when perfect competition in the deposit market forces banks to return all revenue to depositors as is defined in (3.24), ceteris paribus, show how deposit rate \(\delta\) reacts to the loan rate \(r\).
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