Households make their savings available to borrowers through
A) resource markets
B) the loanable funds market
C) the labor market
D) the taxes
E) spending

Question

Quizplus · Accepted Answer

The loanable funds market is where households provide their savings to borrowers, such as firms or governments, who want to invest in new production or infrastructure projects. In return, households receive interest payments on their savings. Resource markets refer to the market for inputs such as land, labor, and capital. The labor market is where firms hire workers and people sell their labor. Taxes are a source of government revenue and not directly related to the savings and borrowing decisions of households. Spending refers to the use of income or savings to purchase goods and services.

Households Make Their Savings Available to Borrowers Through