Use the Table Below to Answer the Following Questions

question 51

Multiple Choice

Use the table below to answer the following questions.
Table 7.2.1
The table shows an economy's demand for loanable funds schedule and supply of loanable funds schedule.

-Consider Table 7.2.1.If planned investment increases by $1.0 trillion at each real interest rate, what is the new equilibrium real interest rate?

• A)5 percent a year
• B)7 percent a year
• C)6.5 percent a year
• D)6.0 percent a year
• E)There is no new equilibrium real interest rate.

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Definitions:

Total Costs

The sum of fixed and variable expenses incurred by a business in the production of goods or services.

Labor Costs

The total sum of all financial compensations and benefits given to employees in exchange for their work, including wages, salaries, and additional perks.

Substitute Resources

Substitute Resources are alternative inputs that can be used in place of another in the production process, often due to cost advantages or availability.

Labor Union

An organization representing workers' interests, focusing on negotiating wages, work hours, benefits, and working conditions.