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How would each of the following scenarios, use supply and demand analysis to predict the resulting changes in the real interest rates, national savings, and
How would each of the following scenarios, use supply and demand analysis to predict the resulting changes in the real interest rates, national savings, and investment? Show your answers in graphs and briefly explain the rationale.
- New digitized machines are able to produce manufactured goods more efficiently and with fewer defects.
- The legislature removes a 15 percent investment tax credit.
- Allowing workers to work remotely at home during the Covid-pandemic causes companies to raise business savings.
- A decline in military spending moves the government's budget from deficit to surplus.
- New Covid19 health regulations increase firms' costs of operating capital.
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