If the government raises taxes on investment returns,then:
A) the demand for loanable funds will increase and the equilibrium interest rate will increase.
B) the demand for loanable funds will decrease and the equilibrium interest rate will decrease.
C) the supply of loanable funds will decrease and the equilibrium interest rate will increase.
D) the supply of loanable funds will increase and the equilibrium interest rate will decrease.
Correct Answer:
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