AP Economics – 3/21/19

I.  Bellwork

Page 274 MC 1-5 & Page 275 FRQ #2

II.  Objectives:

  • Describe how the loanable funds market matches savers and investors
  • Identify the determinants of supply and demand in the loanable funds market
  • Explain how the two models of interest rates can be reconciled

III. Discussion  Pages 276-285

A.  The Market for Loanable Funds

Loanable Funds Market Practice- Macro 4.16

  1. The Equilibrium Interest Rate
  2. Shifts of the Demand for Loanable Funds
  3. Shifts of the Supply of Loanable Funds
  4. Inflation and Interest Rates

B.  Reconciling the Two Interest Rate Models

  1. The Interest Rate in the Short Run
  2. The Interest Rate in the Long Run

C.  Videos

IV.  Classwork

  • 29.1 WS

V.  Homework

  • 29.2 Parts 1&2
  • 4.1 Loanable Funds Parts 1&2


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