Posted: April 2nd, 2017

The Market Forces of Supply and Demand

Several macroeconomic models rely on the basic supply and demand model from microeconomics. Two of these include the market for loanable funds and the markets for labor. What are the ‘prices’ in each of these markets? In the market for loanable funds, how would a large increase in government borrowing to fund national infrastructure spending affect the price and quantity of loanable funds?