Use the following to answer questions: Figure: Loanable Funds Market
-(Figure: Loanable Funds Market) Refer to the figure of the loanable funds market. The equilibrium interest rate in this market is:
A) 3%.
B) 4.5%.
C) 6%.
D) above 6%.

Question

Use the following to answer questions: Figure: Loanable Funds Market 
-(Figure: Loanable Funds Market) Refer to the figure of the loanable funds market. The equilibrium interest rate in this market is:
A) 3%. 
B) 4.5%. 
C) 6%. 
D) above 6%.

Quizplus · Accepted Answer

The equilibrium interest rate is where the demand and supply of loanable funds intersect. In this graph, that occurs at 4.5%.

Use the Following to Answer Questions: Figure: Loanable Funds Market