1)If at a given real interest rate desired national saving is $140 billion, domestic investment is $90 billion, and net capital outflow is $60 billion, then at that real interest rate in the loanable funds market, there is a a

1)If at a given real interest rate desired national saving is $140 billion, domestic investment is $90 billion, and net capital outflow is $60 billion, then at that real interest rate in the loanable funds market, there is a
a. surplus. The real interest rate will rise.
b. surplus. The real interest rate will fall.
c. shortage. The real interest rate will rise.
d. shortage. The real interest rate will fall.

2. In which case can we be sure aggregate demand shifts left overall?
a. people want to save more for retirement and the Fed increases the money supply.
b. people want to save more for retirement and the Fed decreases the money supply.
c. people want to save less for retirement and the Fed increases the money supply.
d. people want to save less for retirement and the Fed decreases the money supply.

3. Which of the following shifts the short-run aggregate supply curve right?
a. both an increase in the price level that is greater than expected and an increase in the expected price level.
b. an increase in the price level that is greater than expected, but not an increase in the expected price level.
c. an increase in the expected price level, but not an increase in the price level that is greater than expected.
d. neither an increase in the price level that is greater than expected nor an increase in the expected price level.

4. If a country makes political reforms so that people now believe this country’s assets are less risky, what happens to its interest rate, its exchange rate, and its net exports?

5. If people in the U.S. choose to save a smaller percentage of income, what will happen to the interest rate, net capital outflow, the exchange rate, and net exports?