A real interest rate that causes the supply of saving to be equal to the demand for saving is an example of the:

Question

Quizplus · Accepted Answer

The equilibrium principle states that in a market, the quantity supplied will be equal to the quantity demanded. In this case, the real interest rate that brings the supply of saving and demand for saving into balance is an example of this principle. Thus, the correct answer is C. The scarcity principle states that resources are limited and cannot satisfy all human wants and needs; the principle of comparative advantage states that individuals and countries can benefit from specialization and trade based on comparative advantages; and the principle of increasing opportunity cost states that as you produce more of a good, the opportunity cost of producing an additional unit of that good increases.

A Real Interest Rate That Causes the Supply of Saving