If supply is upward-sloping and demand is downward sloping, what happens to the equilibrium real risk-free interest rate and quantity of real loanable funds per time period if there is a decrease of the real money supply and an increase in the government's budget deficit?
a. The real risk-free interest rate rises and the quantity per time period falls.
b. The real risk-free interest rate rises and the quantity per time period rises.
c. The real risk-free interest rate does not change and the quantity per time period rises.
d. The real risk-free interest rate is uncertain and the quantity per time period rises.
e. The real risk-free interest rate is rises and the quantity per time period is uncertain.
.E
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