Suppose that the demand for loanable funds for car loans in the Milwaukee area is $10 million per month at an interest rate of 10 percent per year, $11 million at an interest rate of 9 percent per year, $12 million at an interest rate of 8 percent per year, and so on. If the supply of loanable funds is fixed at $15 million, what will be the equilibrium interest rate?

a. The equilibrium interest rate is _______ percent per year.

b. If the government imposes a usury law and says that car loans cannot exceed 3 percent per year, how big will the monthly shortage (or excess demand) for car loans be?
Excess demand will be $ _________million dollars worth of car loans per month.

c. What if the usury limit is raised to 7 percent per year?
The equilibrium interest rate is _________ percent per year; thus, there is $________ of excess demand at that usury limit.