If at a given real interest rate desired national saving is $115 billion, domestic investment is $60 billion, and net capital outflow is $40 billion, then at that real interest rate in the loanable funds market there is a A. surplus. The real interest rate will fall. B. surplus. The real interest rate will rise. C. shortage. The real interest rate will rise. D. shortage. The real interest rate will fall.

If at a given real interest rate desired national saving is $115 billion, domestic investment is $60 billion, and net capital outflow is $40 billion, then at that real interest rate in the loanable funds market there is a A. surplus. The real interest rate will fall. B. surplus. The real interest rate will rise. C. shortage. The real interest rate will rise. D. shortage. The real interest rate will fall.

Economics: Private and Public Choice (MindTap Course List)

16th Edition

ISBN:9781305506725

Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Chapter27: Investment, The Capital Market, And The Wealth Of Nations

Section: Chapter Questions

Problem 11CQ

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