Use the Table Below to Answer the Following Question

question 80

Multiple Choice

Use the table below to answer the following question.
Table 23.3.1
Data from Northland

-Refer to Table 23.3.1. Table 23.3.1 shows the market for loanable funds in Northland. The government budget is balanced. If the government moves from a balanced budget to a surplus of $20 billion, the new equilibrium has a real interest rate of ________ percent and quantity of loanable funds traded equal to ________.

• A)6.5; $110 billion
• B)6.5; $90 billion
• C)5.5; $90 billion
• D)5.5; $110 billion
• E)6; $120 billion

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Definitions:

Productivity

A measure of the efficiency of production, often expressed as the ratio of output to input within a specific period.

Marginal Revenue Product

The additional revenue a firm generates from employing one more unit of input, such as labor or capital.

Productivity

An evaluation of how effectively a person, machine, factory, or system transforms inputs into valuable outputs.

Pure Rent

The return to any factor of production that is in fixed supply.