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Snowcat [4.5K]
3 years ago
11

Assume the economy of Ucheland is currently at full employment. The government of Ucheland reduces the tax rate on household int

erest earnings.
a. What will happen to private savings in Ucheland?
b. Draw a correctly labeled graph of the loanable funds market, and show the effect of the change in private savings identified in part (a) on the equilibrium real interest rate.
Business
1 answer:
drek231 [11]3 years ago
8 0

Answer:

a) since the tax rate oh household interest earnings increases, the number of households that will save money will increase, and the households that were already saving money might increase the amount saved. As a result, private savings will increase in Ucheland.

b) see attached image

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Read 2 more answers
The following data is available for Everest Company:
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Answer:

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Workings

Beginning retained earnings $346

Add: Net income                            $112

Less: Ending retained earnings   -<u>$366</u>

Dividends                                        <u>$92</u>

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