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Managing in a global economy by john marthinsen babson MBA chapter 09

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CHAPTER 9
Interest Rates and Why They Change
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reserved.


Exhibit 9-1
Major Factors Determining Nominal Interest Rates

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reserved.


Exhibit 9-2
Turkey’s Inflation Rate: 1988–2001

Source: International Financial Statistics, (accessed May 25, 2006).

Copyright© 2008 South-Western, a part of Cengage Learning. All rights
reserved.


Exhibit 9-3
Real Loanable Funds Supply and Demand

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reserved.


Exhibit 9-4
Cause-and-Effect Relationships



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reserved.


Exhibit 9-5
Movement along the Real Loanable Funds Supply Curve

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reserved.


Exhibit 9-6
Causes of Real Money Supply Changes

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reserved.


Exhibit 9-7
Increases and Decreases in the Supply of Real
Loanable Funds

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reserved.


Exhibit 9-8
Major Factors Affecting Households’ Supply
of Real Loanable Funds


*Remember that taxes have also affect the supply of real loanable funds through the government sector. Only
the effect on the household sector is shown in this exhibit.

Copyright© 2008 South-Western, a part of Cengage Learning. All rights
reserved.


Exhibit 9-9
Major Factors Affecting Businesses’ Supply of Real
Loanable Funds

*Remember that taxes have also affect the supply of real loanable funds through the government sector. Only
the effect on the business sector is shown in this exhibit.

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reserved.


Exhibit 9-10
Net Effect of a $100 Billion Tax Increase on the Supply
of Real Loanable Funds

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reserved.


Exhibit 9-11
Major Factors Affecting Governments’ Supply of
Real Loanable Funds


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reserved.


Exhibit 9-12
Major Factors Affecting the Foreign Supply of
Real Loanable Funds

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reserved.


Exhibit 9-13
Major Factors Affecting the Real Money Supply

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reserved.


Exhibit 9-14
Summary of the Major Sectors and Factors Influencing
the Supply of Real Loanable Funds

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reserved.


Exhibit 9-15
Movement along the Real Loanable Funds Demand

Curve

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reserved.


Exhibit 9-16
Increases and Decreases in Demand for Real
Loanable Funds

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reserved.


Exhibit 9-17
Summary of the Major Sectors and Factors Influencing
the Demand for Real Loanable Funds

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reserved.


Exhibit 9-18
Equilibrium in the Real Loanable Funds Market

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reserved.


Exhibit 9-19

Effects of a Reduction in Real Government Budget
Deficits

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reserved.


Exhibit 9-20
Euro-Area Real Interest Rates and Trend Line

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reserved.


Exhibit 9-21
Effects of an Increase in the Real Money Supply

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reserved.


Exhibit 9-22
Effects of Speculative Capital Outflows

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reserved.


Exhibit 9-23
Effects of Increased Real GDP on the Real Risk-Free

Interest Rate

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reserved.


Exhibit 9-24
Determinants of Expected Inflation and the Real
Risk-Free Interest Rate

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reserved.


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