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Home / Questions / Now consider the following information from Round 2 of the same variation

Now consider the following information from Round 2 of the same variation

Now consider the following information from Round 2 of the same variation.


Borrower Nominal Rate of
Return on Project (%)

Ayon 13.8
Barb 13.0
Carlos 12.2
Darius 11.4
Ellen 10.6
Fay 9.8
Grace 9.0
Habeeb 8.2
Ida 7.4
Jack 6.6



The nominal T-bill interest rate is 7.0% in Round 2. The in flationrate over the course of Round 2 is 6.0%.

Which of the following results would supply and demand analysis predict for Round 2?
 
    A.   Borrowers and lenders will arrange 9loans, at nominal interest rates of 6.6% or slightly lower.
 
    B.   Borrowers and lenders will arrange 9 loans, at nominal interest rates of 1.0% or slightly higher.
 
    C.   Borrowers and lenders will arrange 8loans, at nominal interest rates of 6.6% or slightly higher.
 
    D.   Borrowers and lenders will arrange 9loans, at nominal interest rates of 7.0% or slightly higher.
 
    E.   Borrowers and lenders will arrange 9loans, at nominal interest rates of 6.0% or slightly lower.

Apr 26 2018 View more View Less

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