Solved

Refer to the Market for Loanable Funds, as Shown in the Graph

Question 171

Multiple Choice

Refer to the market for loanable funds, as shown in the graph. Suppose the market for loanable funds is originally in equilibrium at interest rate i ₀ and quantity Q ₀ . In the next period, the equilibrium interest rate increases to i ₁ and quantity decreases to Q ₁. Which of the following could be the cause of this shift? A) Households decide to save less. B) Households decide to save more. C) Investors become less optimistic. D) Investors become more optimistic. Refer to the market for loanable funds, as shown in the graph. Suppose the market for loanable funds is originally in equilibrium at interest rate i ₀ and quantity Q ₀ . In the next period, the equilibrium interest rate increases to i ₁ and quantity decreases to Q ₁. Which of the following could be the cause of this shift?


A) Households decide to save less.
B) Households decide to save more.
C) Investors become less optimistic.
D) Investors become more optimistic.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions

Q166: The supply of loanable funds is an

Q167: The schedule shows</p></div><svg width=

Q168: Which of the following would cause an

Q169: Suppose many businesses want to increase their

Q170: A decrease in the supply of loanable

Q172: The schedule shows</p></div><svg width=

Q173: The schedule shows</p></div><svg width=

Q174: The schedule shows</p></div><svg width=

Q175: Refer to the</p></div><svg width=

Q176: The supply curve for loanable funds is

Unlock this Answer For Free Now!

View this answer and more for free by performing one of the following actions

qr-code

Scan the QR code to install the App and get 2 free unlocks

upload documents

Unlock quizzes for free by uploading documents