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What is the importance of the loanable funds market? Discuss the factors that affect the market for loanable funds. What is the impact of the

What is the importance of the loanable funds market? Discuss the factors that affect the market for loanable funds.

What is the impact of the $3.8 trillion government stimulus on the market of loanable funds and real interest rates? Note that what the model prediction is not what was observed during the pandemic. Why? The model keeps other things constant (ceteris paribus). Keep in mind that expansionary monetary policy also played a major role on interest rates. This illustrates the importance of coordinated policy.

Bonus question: Which process seemed to have been easier to implement, interest rate changes from the Federal Reserve or Spending Bills by Congress?

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