In the market for loanable funds, the supply curve:
A. is downward sloping.
B. is made up of people who want to borrow funds.
C. represents savers.
D. reflects that more people will choose to save the lower is the interest rate.
Answer: C
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Suppose there has been an increase in investment. As a result, real GDP will ________ in the short run, and ________ in the long run
A) decrease; increase to its initial level B) increase; increase further C) increase; decrease to its initial value D) decrease; decrease further
The perfectly competitive firm's demand curve has
A. a slope of infinity. B. a positive slope. C. a negative slope. D. a slope of 0.
If the saving rate increases, break-even investment will be ________ than investment, and GDP per worker will ________
A) greater; increases B) greater; decreases C) less; increases D) less; decreases
What is the difference between the federal budget deficit and the national debt?
a. The budget deficit is the amount by which expenditures exceed revenues in a particular year, while the national debt is the cumulative effect of all past budget deficits and surpluses. b. The budget deficit is the cumulative effect of all prior national debts. c. The national debt includes all outstanding bonds, while the budget deficit excludes bonds held by government agencies. d. This is a trick question because there is no difference between the budget deficit and the national debt.