The marginal propensity to save is:

Exhibit: Saving, Investment, and the Interest Rate    The economy begins in equilibrium at point E, representing the real interest rate r1 at which saving S1 equals desired investment I1. What will be the new equilibrium combination of the real interest rate, saving, and investment if there is a tax law change that makes investment projects less profitable and decreases the demand for investment goods (but does not change the amount of taxes collected in the economy)?

Assume that the investment function is given by I = 1,000 − 30r, where r is the real rate of interest (in percent). Assume further that the nominal rate of interest is 10 percent and that the inflation rate is 2 percent. According to the investment function, investment will be:

An increase in the supply of capital will:

Assume that equilibrium GDP (Y) is 5,000, consumption (C) is C = 500 + 0.6 (Y − T), taxes (T) are 1,000, and government spending is 600. Equilibrium investment is:

In a barter system, the term “double coincidence of wants” refers to what situation?

Assume that equilibrium GDP (Y) is 5,000, consumption (C) is C = 500 + 0.6Y, and G = 0. Equilibrium investment is:

According to the quantity theory of money, a 5 percent increase in money growth increases inflation by _____ percent. According to the Fisher equation, a 5 percent increase in the rate of inflation increases the nominal interest rate by _____ percent.

Credit card balances are included in:

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