1.Fill in the blanks in the table by calculating the real interest rate for the years listed. (4 marks)

a.Was the real interest rate constant, rising or falling between 2001 and 2004? (1 mark)

b.Was the real interest rate constant, rising or falling between 2001 and 2004? (1 mark)

c.Assuming all else constant, what effect would the change in real interest rate between 1979 and 1982 have had on the willingness of consumers and businesses to borrow money? (2 mark)