Figure 8-4. On the horizontal axis of the graph, L represents the quantity of loanable funds in billions of dollars.
-Refer to Figure 8-4. If the equilibrium quantity of loanable funds is $56 billion and if the rate of inflation is 5 percent, then the equilibrium nominal interest rate is
A) lower than 6 percent..
B) approximately 6 percent.
C) between 6 percent and 8 percent.
D) approximately 12 percent.
Correct Answer:
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