An increase in the confidence that car-buying consumers have in their future income will
A. decrease the demand for borrowable money.
B. increase the supply of borrowable money.
C. decrease the supply of borrowable money.
D. increase the demand for borrowable money.
Answer: D
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An increase in the foreign real interest rate will tend to cause, other things the same ________
A) individuals to hold fewer dollar assets B) an increase in the return on dollar assets relative to foreign assets C) an appreciation in the value of the U.S. dollar D) an increase in the demand for dollars
Products sold by monopolistically competitive firms are perfect substitutes of each other
a. True b. False Indicate whether the statement is true or false
Assume that the real rate of interest is 5 percent and a lender charges a nominal interest rate of 15 percent. If a borrower expects that the rate of inflation next year will be 10 percent and the actual rate of inflation next year is 12 percent:
A. neither the borrower nor the lender benefits from inflation. B. both the borrower and the lender lose from inflation. C. the borrower benefits from inflation, while the lender loses from inflation. D. the lender benefits from inflation, while the borrower loses from inflation.
The Bertrand model of oligopoly reveals that:
A. capacity constraints are not important in determining market performance. B. changes in marginal cost do not affect prices. C. perfectly competitive prices can arise in markets with only a few firms. D. All of the statements associated with this question are true.