Refer to the Table Below to Answer the Following Question

question 121

Multiple Choice

Refer to the table below to answer the following question.
Table 7.3.5 Table 7.3.5 shows an economy's demand for loanable funds schedule and supply of loanable funds schedule when the government's budget is balanced.If the government budget surplus becomes $2.0 trillion, the real interest rate is percent a year, the quantity of investment is trillion, and the quantity of private saving is _ trillion.
A) 6; $7.5; $5.5 B) 8; $6.5; $6.5 C) 10; $7.5; $5.5 D) 10; $5.5; $7.5 E) 6; $7.5; $7.5
Answer: A
-The government of Greece is running a large budget deficit.With no Ricardo- Barro effect, which of the following events occurs? I.The supply curve of loanable funds shifts leftward.
II.A higher real interest rate crowds out investment.
III.Saving increases.

• A) 6; $7.5; $5.5 B) 8; $6.5; $6.5 C) 10; $7.5; $5.5 D) 10; $5.5; $7.5 E) 6; $7.5; $7.5
• Answer: A
• -The government of Greece is running a large budget deficit.With no Ricardo- Barro effect, which of the following events occurs? I.The supply curve of loanable funds shifts leftward.
• II.A higher real interest rate crowds out investment.
• III.Saving increases.
• A)I only
• B)II only
• C)III only
• D)II and III only
• E)I, II, and III

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Definitions:

Work Sharing

a strategy designed to reduce unemployment or workload for individuals by distributing tasks among a larger group, thereby also potentially reducing working hours for each participant.

Seniority

The concept of giving priority or advantages in a workplace based on the length of service or time an individual has been in a position.

Reduced Earnings

A decrease in the net income that a company generates over a defined period compared to past performances.

Flexible Working Hours

Flexible Working Hours refer to work schedules that allow employees some choice in determining when they begin and end their working days, offering adaptability to meet personal needs and improve work-life balance.