Determinants of the size of loanable funds market

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1. Explain the determinants of the size of loanable funds market. Define a loanable demand function. Why a demand for loanable funds curve is downward slopping?

2. Why and how are different types of financial institutions important in an economy? Distinguish between nominal interest rate and real interest rate. Show and briefly explain with examples the flow chart that demonstrates flow of funds available for investment in an economy.

Reference no: EM132601196

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