The market interest rate increased by 2.0%, and the amount of capital borrowed billion. Which of the following factors could be responsible for the change in demand shown in the graph? New technological advances opened up more production opportunities for businesses. Expected inflation decreased The Federal Reserve (the Fed) decided to relax its monetary policy and expanded the money supply. Households began saving a greater percentage of their income. Does it appear that the economy has strengthened or weakened over the past year? Strengthened Weakened If the inflation rate was 2.40% and the nominal interest rate was 7.00% over the last year, what was the real rate of interest over the last year Disregard cross-product terms; that is, if averaging is required, use the arithmetic average. 4.60% 3.91% 5.29% 5.75% Grade It Now Save & Continue