Other things constant,the supply of loanable funds curve is _____
A) upward sloping because fewer people have to be persuaded to forgo current consumption as the interest rate rises.
B) downward sloping, showing that more investment will be undertaken as inflation decreases.
C) upward sloping because the reward for saving increases as the interest rate increases.
D) downward sloping, showing that as more funds are available, the risk of loaning funds decreases.
E) usually horizontal, showing that the supply of loans is independent of the rate of inflation in an economy.
Correct Answer:
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