This topic contains a solution. Click here to go to the answer

Author Question: Why are real interest rates more important than nominal interest rates with regard to analyzing the ... (Read 126 times)

Medesa

  • Hero Member
  • *****
  • Posts: 507
Why are real interest rates more important than nominal interest rates with regard to analyzing the supply and demand of loanable funds?

Question 2

The market demand curve is derived by summing individual demand curves horizontally.
 a. True
  b. False
  Indicate whether the statement is true or false



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

succesfull

  • Sr. Member
  • ****
  • Posts: 339
Answer to Question 1

Nominal interest rates only indicate the amount of dollars that are paid or received as interest. Real interest rates indicate the amount of purchasing power paid or received as interest. Borrowers are more influenced by the purchasing power than they will sacrifice to borrow money; similarly savers are more influenced by the purchasing power they will receive for on their deposits.

Answer to Question 2

True




Medesa

  • Member
  • Posts: 507
Reply 2 on: Jun 30, 2018
Thanks for the timely response, appreciate it


softEldritch

  • Member
  • Posts: 334
Reply 3 on: Yesterday
Great answer, keep it coming :)

 

Did you know?

Children of people with alcoholism are more inclined to drink alcohol or use hard drugs. In fact, they are 400 times more likely to use hard drugs than those who do not have a family history of alcohol addiction.

Did you know?

Chronic marijuana use can damage the white blood cells and reduce the immune system's ability to respond to disease by as much as 40%. Without a strong immune system, the body is vulnerable to all kinds of degenerative and infectious diseases.

Did you know?

People about to have surgery must tell their health care providers about all supplements they take.

Did you know?

Blood is approximately twice as thick as water because of the cells and other components found in it.

Did you know?

Signs and symptoms that may signify an eye tumor include general blurred vision, bulging eye(s), double vision, a sensation of a foreign body in the eye(s), iris defects, limited ability to move the eyelid(s), limited ability to move the eye(s), pain or discomfort in or around the eyes or eyelids, red or pink eyes, white or cloud spots on the eye(s), colored spots on the eyelid(s), swelling around the eyes, swollen eyelid(s), and general vision loss.

For a complete list of videos, visit our video library