If funds supplied by surplus units exceeded funds demanded by deficit units
A) Interest rates would fall
B) Interest rates would rise
C) A permanent disequilibrium would develop
D) Interest rates would be unaffected
Correct Answer:
Verified
Q2: Households
A) Are dis-savers in their early and
Q3: Businesses
A) Are deficit units because the profit-maximizing
Q4: State and local governments
A) Are chronic deficit
Q5: Commercial banks
A) Are surplus units
B) Are deficit
Q6: For the United States, the external sector
Q8: Lower financing costs (interest rates)
A) Encourage businesses
Q9: Which of the following is characteristic of
Q10: In a competitive financial system
A) Surplus funds
Q11: If government spending were to increase and
Q12: An effective financial system
A) Reallocates risk toward
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