Question: Step 1 Analyze changes in the real interest rate. If there is a rise in the real interest rate, how does the quantity of loanable

Step 1Analyze changes in the real interest rate.

If there is a rise in the real interest rate, how does the quantity of loanable funds demanded change? Explain.
If there is a fall in the real interest rate, how does the quantity of loanable funds supplied change? Explain.

Step 2Determine the equilibrium real interest rate.

The table below is broken down by Month, Real Interest Rate (%), Loanable Funds (trillions of $), Exogenous Change, Equilibria (increases, decreases, or no change. Use the data table to determine the equilibrium real interest rate after certain factors change:

Month	Real Interest Rate (%)	Loanable Funds (trillions of $)	Exogenous Change	Equilibria (increases, decreases, or no change)
January	3%	3	no change	no change
April	3%	4	increased fund supply	?
July	4%	2	decreased fund supply	?
December	3%	3	increased fund demand	?

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