The stock market boom of 20022007 increased wealth by trillions of dollars. Explain the effect of this

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The stock market boom of 2002–2007 increased wealth by trillions of dollars. Explain the effect of this increase in wealth on the equilibrium real interest rate, investment, and saving.


The U.S. saving rate increased from –0.1 percent in 2011 to 2.0 percent in 2012 to 2.4 percent in 2013, to 2.9 percent in 2014, and to 3.0 percent in 2015.

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Foundations of Macroeconomics

ISBN: 978-0134492001

8th edition

Authors: Robin Bade, Michael Parkin

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