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In the Loanable Funds Market

Question 94

Multiple Choice

In the loanable funds market,


A) savers are suppliers of loanable funds, and borrowers are demanders of loanable funds
B) the supply curve slopes downward, and the demand curve slopes upward
C) the supply curve reflects the negative relation between the market rate of interest and the quantity of savings
D) households play the role of financial intermediaries
E) banks pay a higher interest rate on consumer savings than they could earn by lending these funds out

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