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ch4aika [34]
3 years ago
14

Suppose that the demand for loanable funds for car loans in the milwaukee area is $10 million per month at an interest rate of 1

0 percent per year, $11 million at an interest rate of 9 percent per year, $12 million at an interest rate of 8 percent per year, and so on. if the supply of loanable funds is fixed at $15 million, what will be the equilibrium interest
Business
1 answer:
Tju [1.3M]3 years ago
4 0

Answer:

5 percent per year.

Explanation:

Base on the scenario been described in the question, where we saw the demand loanable funds for car loans in the milwaukee area is $10 million per month at an interest rate of 10 percent per year, $11 million at an interest rate of 9 percent per year, $12 million at an interest rate of 8 percent per year, if eventually the supply of loanable funds is fixed at $15 million, the equilibrium rate will be 5 percent per year because it is fixed

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Assume the current U.S. dollar-yen spot rate is 90 ¥/$. Further, the current nominal 180-day rate of return in Japan is 1% (annu
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