Question
The Bureau of Labor Statistics releases economic data on unemployment leading to a wave of optimism for savers and investors. This causes a change in
The Bureau of Labor Statistics releases economic data on unemployment leading to a wave of optimism for savers and investors. This causes a change in demand for investment of 3 trillion and change in supply of savings of 2 trillion.
Real Interest Rate (% per year) | Investment (trillions of 2011 dollars) | Savings (trillions of 2011 dollars) |
---|---|---|
1 | 8 | 3 |
4 | 6 | 6 |
7 | 4 | 9 |
10 | 2 | 12 |
13 | 0 | 15 |
The new equilibrium interest rate is _______ ["4%", "between 1% and 3%", "4 trillion", "rises above 10%", "1%", "7%"] % and the new level of saving and investment is $ _______ ["between 8 and 9 trillion dollars", "no effect on the market", "5 trillion dollars", "10%", "7 trillion dollars", "falls below 1 trillion"] trillion.
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