FOREX Graph

Here is the review video for the FOREX graphs

Loanable Funds and Money Market Graphs

Here are the two latest videos on graphing - Loanable Funds and Money Market

1. Loanable Funds Graph

2. Money Market

Loanable Funds and Money Market Practice

Here are a few practice problems for tomorrows quiz

2005 #1

1.       Assume that declining stock market prices in the United States cause many United States financial investors to sell their stocks and increase their money holdings.

a.       Draw a correctly labeled graph of the money market and show the impact of the financial investors’ actions on each of the following.

                                                               i.      Demand for money

                                                             ii.      Nominal interest rate

2010 #2

2.       A drop in credit card fees causes people to use credit cards more often for transactions and demand less money.

a.       Using a correctly labeled graph of the money market, show how the nominal interest rate will be affected.

2007 Form B #2

2.        

a.       Assume that businesses are granted a tax credit on spending for machinery. Using a correctly labeled graph of the loanable funds market, show the effect of the business sector’s response on the real interest rate.

b.      Now assume instead that the tax rate on interest income from household savings is lowered and there is no change in government budget deficit.  Using a second labeled graph of the loanable funds market, show the effect of the households’ response on the real interest rate.

2005 Form B #3

3.       Assume that an increase in government spending increases the budget deficit in Country A.

a.       Using a correctly labeled graph of the loanable funds market, show the effect of the increase in Country A’s budget deficit on the real interest rate.