The supply curve of loanable funds slopes up because
A)at higher bond prices more loanable funds will be supplied.
B)higher interest rates reduce the inflation rate.
C)an increase in the interest rate makes lenders more willing and able to supply more funds.
D)a decrease in the interest rate makes lenders more willing and able to supply more funds.

Question

Quizplus · Accepted Answer

An increase in the interest rate incentivizes lenders by offering higher returns on their loans, making them more willing and able to supply additional funds to the loanable funds market.

The Supply Curve of Loanable Funds Slopes Up Because