Suppose the government lowers the tax rate on interest income. employ the supply and demand diagram of the loanable fund market to answer the following questions a) illustrate and show that the policy will induce a smaller effect on investment when the demand for loanable funds is more inelastic.
b)illustrate and show that the policy will induce a smaller effect on investment when the demand for loanable funds is more elastic.

answer; the correct answer to the above statement is (true);

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"we first find value of tax in dollars.

the difference between the two prices   is: 23. 54 - 22 = 1.54

therefore the sales tax in dollars is 1.54

the tax % will be   (amount of tax / original cost price ) × 100

(1.54 / 22) × 100  → (0.07) × 100 =   7

so the tax rate is 7%

we can double check the answer.

7 % of 22   → (7/100) × 22 → 0.07 × 22 = 1.54

22 + 1.54 = 23.54"

you have to put the parentheses like this:

in fact, you have to perform the operation inside parentheses first, and then proceed in order:

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