In the loanable funds framework,the ________ is measured on the vertical axis.
A)price of bonds
B)interest rate
C)quantity of bonds
D)quantity of loanable funds

Question

Quizplus · Accepted Answer

The interest rate is the cost of borrowing or the return on lending, which is the key variable in the loanable funds framework. It is measured on the vertical axis, while the quantity of loanable funds is measured on the horizontal axis. The price of bonds and the quantity of bonds are not the primary focus of the loanable funds framework.

In the Loanable Funds Framework,the ________ Is Measured on the Vertical