What happens to the quantity of loanable funds supplied when the interest rate rises? Explain why this change happens
The quantity of loanable funds supplied rises because a higher real interest rate encourages people to increase their saving.
You might also like to view...
A sudden fall in the market demand in a competitive industry leads to
a. A short run market equilibrium price higher than the original equilibrium b. A market equilibrium price lower than the short run price c. Some firms exiting the market d. All of the above
For which rate of inflation given below will the real interest rate be higher than the nominal interest rate?
a. –0.5% b. 0.2% c. 0.5% d. 1.5%
What are the similarities between perfect competition and monopolistic competition?
What will be an ideal response?
A price floor is:
a. the lowest price a producer will accept. b. the lowest price a consumer will pay. c. a minimum price set by the government above equilibrium price. d. a maximum price set by the government above equilibrium price e. usually set equal to equilibrium price.