The supply curve for loanable funds slopes the way it does because if interest rates are low, fewer projects will have a rate of return high enough to justify the investment.

Question

Quizplus · Accepted Answer

The supply curve for loanable funds slopes upwards because as interest rates increase, savers are more willing to save their money, thus increasing the amount of funds available for loans.

The Supply Curve for Loanable Funds Slopes the Way It