Each of the following can contribute to the change in the supply of loans resulting from an interest rate change, except:

Question

Quizplus · Accepted Answer

The question asks for the factor that does not contribute to the change in the supply of loans resulting from an interest rate change. Changes in the percentage of loan payment to income, changes in the potential of moral hazard, and changes in borrowers' net worth are all factors that affect the willingness and ability of borrowers to take out loans, and thus can affect the supply of loans. However, an increase in the demand for loans does not directly affect the supply of loans. It may lead to an increase in the interest rate, which can indirectly affect the supply of loans, but the demand for loans in and of itself does not directly contribute to the change in the supply of loans resulting from an interest rate change.

Each of the Following Can Contribute to the Change in the Supply