Exam 6: Economic Growth, The Financial System, and Business Cycles

Since 1961, real GDP per capita has ________ and this measure ________ the actual growth in standards of living in Canada over this time.

Figure 6.3 Alt text for Figure 6.3: In figure 6.3, a graph comparing loanable funds and real interest rate. Long description for Figure 6.3: The x-axis is labelled, loanable funds (billions of dollars per year), with values L1 and L2 marked.The y-axis is labelled, real interest rate, with values i1 and i2 marked.3 lines are shown; Supply S1, S2 and Demand.The Demand line begins at the top left corner and slopes down to the bottom centre.Line S1 begins near the origin and slopes up to the top right corner.Line S2 follows the same slope as line S1, but is plotted to the right.The area between lines S1 and S2 is indicated by a right pointing arrow.The Demand line intersects S1 at point (L1, i1), a little more than half-way along both the lines.The Demand line intersects S2 at the point (L2, i2), a little more than half-way along both of the lines.These points of intersection are connected to their respective coordinates on the x and y-axis with dotted lines.Between these dotted lines, an arrow points right from L1 to L2,and another arrow points down from i1 toward i2. -Refer to Figure 6.3.Which of the following is consistent with the graph depicted above?