ZuoTi.Pro
Question

Real interest rate (R) Share available for nongovernment use (1 - G/Y) ut of Nongoverment Share (NG/Y) Percent In the diagram
business   economics   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1

(b) The non-government share shift to the left and the real interest rate falls

Reason:

As sales tax is imposed, it will increase the government revenue which results in rise in the government share, if there is rise in government share then there is decline in non-government share which shifts to the left, if non-government share shift to the left it results in fall of real interest rates.

So option b is the correct answer

0 0
Add a comment
Know the answer?
Add Answer to:
Real interest rate (R) Share available for nongovernment use (1 - G/Y) ut of Nongoverment Share...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • 10. The real interest rate is the (x) real rate of return to the lender. (y)...

    10. The real interest rate is the (x) real rate of return to the lender. (y) real cost of borrowing to the borrower. (z) nominal interest rate plus the rate of inflation. A. (x), (y) and (z) B. (x) and (y) only C. (x) and (z) only D. (y) and (z) only E. (z) only 13. If there is a shortage of loanable funds, then A. neither curve shifts, but the quantity of loanable funds supplied decreases and the quantity...

  • 3. Suppose that prices are completely rigid, so that the nominal and the real interest rate...

    3. Suppose that prices are completely rigid, so that the nominal and the real interest rate are necessarily equal. Money-market equilibrium is therefore given b L(r,Y). a. Suppose that government purchases increase, and that the central bank adjusts the money supply to keep the interest rate unchanged. i. Does the money supply rise or fall? ii. What happens to consumption and investment? b. Suppose that government purchases increase, and that the central bank adjusts the money supply to keep output...

  • 1. The interest rate in the federal funds market: a. is an interest rate that is...

    1. The interest rate in the federal funds market: a. is an interest rate that is largely unaffected by the policies of the Fed. b. will fall if the Fed sells bonds and, thereby, reduces the reserves available to banks. c. is determined by the imposition of price controls imposed by the Fed. d. rises when the quantity of funds demanded by banks seeking additional reserves exceeds the quantity supplied by banks with excess reserves. 2. If there is a...

  • Scenario: Country X and Country Y production amount of physical capital stock available to each country is also equal. However, the labor supply for Country X is Ho while the labor supply for Cou...

    Scenario: Country X and Country Y production amount of physical capital stock available to each country is also equal. However, the labor supply for Country X is Ho while the labor supply for Country Y is Hy identical aggregate production functions as shown in the figure below. The Output 0 H, H, Efficiency units of Labor 8) Refer to the scenario above. A one-unit increase in the efficiency units of labor will lead to in output in Country X than...

  • For all the questions below select the appropriate answer: MP IMP Interest rate i INTY) Real...

    For all the questions below select the appropriate answer: MP IMP Interest rate i INTY) Real money balances The money market in the diagram presented shows that with unchanged demand for money the market adjustment to an increase in real money supply: changes the price level to hold the real money supply constant has no effect on interest rates or bond prices. raises the equilibrium interest rate from it to lo as portfolio managers bid bond prices down. lowers the...

  • Figure 13-2 Real Interest Rate Supply of Loarable Funds World interest rate, o Derrand for Loanable...

    Figure 13-2 Real Interest Rate Supply of Loarable Funds World interest rate, o Derrand for Loanable Funds Quantity of Loanable Funds Real Exchange Rate Supply of Canadian Dollars (5-1) Quantity of Dollars Refer to the Figure 13-2. If the interest rate was initially at ro and an import quota was imposed, what would happen to the real interest rate? It would decrease because demand would shift left. It would decrease because supply would shift right. It would not change because...

  • Suppose a decrease in aggregate demand shifts the economy from equilibrium to P, and Y. Price Level ................

    Suppose a decrease in aggregate demand shifts the economy from equilibrium to P, and Y. Price Level ............. Y, Y Real GDP a. Which of the following events would likely chuse the decrease in aggregate demand? Personal consumption falls as workers become concerned about future employment prospects Gross investment increases as capital units become fully utilized. Imports decrease due to increased foreign prices. a. Which of the following events would likely cause the decrease in aggregate demand? Personal consumption falls...

  • 5. Suppose that instead of following the interest rate rule r=r(Y), the central bank keeps the...

    5. Suppose that instead of following the interest rate rule r=r(Y), the central bank keeps the money supply constant. That is, suppose M = M. In addition, suppose that prices are completely rigid, so that the nominal and the real interest rate are necessarily equal; money-market equilibrium is therefore given by M/= = L(r,Y). a. Suppose that the money market is in equilibrium when r = ro and Yo. Now suppose Y rises to Y). For the money market to...

  • 1: what would happen to national saving, investment, trade balance interest rate, and real exchange rate...

    1: what would happen to national saving, investment, trade balance interest rate, and real exchange rate in responding to an increase in tariff on imported cars by the domestic government? graphically explain with the help of large open economy 2: what do you mean by trade policies? it's argued that protectionist trade policy benefits only local producers whereas society on the average suffers from it, do you agree with the statement? graphically explain considering a model of small open economy?

  • The answer is here. Could you please explain question 19 and how was that 110 comes...

    The answer is here. Could you please explain question 19 and how was that 110 comes out? Thanks. Question 18 Question 20: In this question, interest rate and prices are held fixed, and the economy can be described by the income-expenditure model C 11000.6YD; IPlanned 300 500i, Consumption: Planned investment: where YD disposable income where i = 0.04 (i.e., 4% & it is held fixed) Таxes: T 280 Transfers Government spending: TR 100 G 160 Question 18 Compute for the...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT