social problems rarely have simple answers. Even those who agree on how a proposed economic policy affects

quantity demanded and quantity supplied may still disagree on whether the policy is a good idea.

4.2 Demand and Supply in Financial Markets

LEARNING OBJECTIVES

By the end of this section, you will be able to:

•

Identify the demanders and suppliers in a financial market

• Explain how interest rates can affect supply and demand

• Analyze the economic effects of U.S. debt in terms of domestic financial markets

• Explain the role of price ceilings and usury laws in the U.S.

United States' households, institutions, and domestic businesses saved almost $1.3 trillion in 2015. Where did

that savings go and how was it used? Some of the savings ended up in banks, which in turn loaned the money

to individuals or businesses that wanted to borrow money. Some was invested in private companies or loaned
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