This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: Using the above figure, which of the following is CORRECT? A) 1 guilder will sell for 2. B) 1 ... (Read 40 times)

kodithompson

  • Hero Member
  • *****
  • Posts: 566
on: Jun 29, 2018
Using the above figure, which of the following is CORRECT?
 
  A) 1 guilder will sell for 2.
  B) 1 dollar will sell for 1/2 guilder.
  C) A shortage of guilders exists at an exchange rate above 0.60.
  D) A surplus of guilders exists at an exchange rate above 0.60.

Question 2

In the loanable funds market, what variable changes to eliminate a shortage of loanable funds and how is the shortage eliminated?
 
  What will be an ideal response?


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

chloejackso

  • Sr. Member
  • ****
  • Posts: 316
Reply #1 on: Jun 29, 2018
Answer to Question 1

D

Answer to Question 2

The real interest rate changes to eliminate the shortage of loanable funds. A shortage of loanable funds means that businesses and others want to borrow more than households and others are willing to loan so that the quantity of loanable funds demanded exceeds the quantity of loanable funds supplied. This shortage means that some businesses are willing to pay a higher interest rate. The real interest rate rises, and as it does so, the quantity of loanable funds demanded decreases and the quantity of loanable funds supplied increases. Both changes help eliminate the shortage of loanable funds and so the real interest rate rises until it reaches its equilibrium value.


kodithompson

  • Member
  • Posts: 566
Reply 2 on: Jun 29, 2018
Great answer, keep it coming :)

cassie_ragen

  • Member
  • Posts: 347
Reply 3 on: Yesterday
YES! Correct, THANKS for helping me on my review

« previous next »
 

Did you know?

Asthma cases in Americans are about 75% higher today than they were in 1980.

Did you know?

Throughout history, plants containing cardiac steroids have been used as heart drugs and as poisons (e.g., in arrows used in combat), emetics, and diuretics.

Did you know?

Approximately 500,000 babies are born each year in the United States to teenage mothers.

Did you know?

Stevens-Johnson syndrome and Toxic Epidermal Necrolysis syndrome are life-threatening reactions that can result in death. Complications include permanent blindness, dry-eye syndrome, lung damage, photophobia, asthma, chronic obstructive pulmonary disease, permanent loss of nail beds, scarring of mucous membranes, arthritis, and chronic fatigue syndrome. Many patients' pores scar shut, causing them to retain heat.

Did you know?

Though the United States has largely rejected the metric system, it is used for currency, as in 100 pennies = 1 dollar. Previously, the British currency system was used, with measurements such as 12 pence to the shilling, and 20 shillings to the pound.

The correct statement about hormones-insulin and glucagon The correct statement about hormones-insulin and glucagon
Correct use a fire extinguisher Correct use a fire extinguisher
Figure 7.1 shows the rapid decline in the trust of Americans in government since the 1960s. This de Figure 7.1 shows the rapid decline in the trust of Americans in government since the 1960s. This de
Correct position when lifting a heavy object off the floor. Correct position when lifting a heavy object off the floor.
Paul Colin, Figure of a Woman. Paul Colin, Figure of a Woman.
Mobilize the joints in the hand. Follow with figure-8s at the knuckles and scissoring the ... Mobilize the joints in the hand. Follow with figure-8s at the knuckles and scissoring the ...
Video: Mechanisms for chromosome movement Animation

For a complete list of videos, visit our video library