The demand for loanable funds is equivalent to:
A) national saving.
B) private saving.
C) public saving.
D) investment.

Question

Quizplus · Accepted Answer

The demand for loanable funds is equivalent to investment because it represents the amount of funds that firms and other borrowers are willing and able to borrow for investment purposes. National savings (A) is the sum of private and public saving, while private saving (B) is the portion of national income that households choose to save rather than consume. Public saving (C) is the difference between government revenue and expenditures and can either be positive (surplus) or negative (deficit).

The Demand for Loanable Funds Is Equivalent To