What determines the supply of loanable funds and what makes it change?
What will be an ideal response?
The supply of loanable funds depends on the real interest rate, disposable income, expected future income, wealth, and default risk. An increase in the real interest rate increases the quantity of loanable funds supplied; a decrease in the real interest rate decreases the quantity of loanable funds supplied. An increase in disposable income increases the supply of loanable funds; a decrease in disposable income decreases the supply of loanable funds. An increase in wealth decreases the supply of loanable funds; a decrease in wealth increases the supply of loanable funds. An increase in expected future income decreases the supply of loanable funds; a decrease in expected future income increases the supply of loanable funds. Finally, an increase in default risk decreases the supply of loanable funds; a decrease in default risk increases the supply of loanable funds.
You might also like to view...
Assuming that one dollar trades for 50 rupees, what is the dollar cost of 750 rupees?
A) $50 B) $75 C) $5 D) $15
Which of the following describes the out-of-pocket costs a firm pays?
a. Revenue costs b. Explicit costs c. Economic costs d. Implicit costs
Suppose you have a fixed amount of income to spend on two goods, X and Y. The price of good X is Px = $10, and the price of good Y is Py = $5. The marginal utility of X is MUx = 60 utils, and the marginal utility of Y is MUy = 15 utils. How should consumption of X and Y change, if at all, to increase utility?
What will be an ideal response?
The market value of final goods and services produced within a country during a period of time is called:
A. government documented production. B. gross domestic product. C. general domestic productivity. D. guaranteed direct prices.