| Question |
Answer |
| Crowding-Out Effect | A phrase pertaining to the government's willingness to pay more for borrowed funds than the private sector. |
| Demand For Loanable Funds | A widely used phrase in financial markets pertaining to the borrowing activities of households, businesses, and governments. |
| Equilibrium Interest Rate | The interest rate that equals the aggregate demand for loanable funds with the aggregate supply of loanable funds. |
| Fisher Effect | The relationship between interest rates and expected inflation. |
| Interest-Inelasticity | Insensitivity to interest rates. |
| Loanable Funds Theory | A theory suggesting that the market interest rate is determined by the factors that control supply and demand for loanable funds. |
| Nominal Interest Rate | The quoted rate of interest. |
| Real Interest Rate | The difference between the nominal interest rate and the expected inflation rate. |
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