5 Draw a graph of First Calls demand for loanable funds curve. First Call plc is a...

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5 Draw a graph of First Call’s demand for loanable funds curve. First Call plc is a mobile phone company. It plans to build an assembly plant that costs £10 million if the real interest rate is 6 per cent a year. If the real interest rate is 5 per cent a year, First Call will build a larger plant that costs £12 million. And if the real interest rate is 7 per cent a year, First Call will build a smaller plant that costs £8 million.

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Economics

ISBN: 9781118150122

10th European Edition

Authors: Michael Parkin, Dr Melanie Powell, Prof Kent Matthews

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