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Question 72

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Use the following to answer questions: Use the following to answer questions:   -(Figure: The Loanable Funds Model in the Canadian Market) Refer to Figure: The Loanable Funds Model in the Canadian Market.Assume that each country's (Canada and Britain) equilibrium interest rate is 4%.To reconcile the apparent disequilibrium in both markets,assuming that assets and liabilities are viewed as homogeneous,capital _____ will _____ interest rates. A)  outflow from Canada;lower Canadian B)  outflow from Britain;lower British C)  outflow from Britain;raise British D)  inflow to Canada;raise Canadian
-(Figure: The Loanable Funds Model in the Canadian Market) Refer to Figure: The Loanable Funds Model in the Canadian Market.Assume that each country's (Canada and Britain) equilibrium interest rate is 4%.To reconcile the apparent disequilibrium in both markets,assuming that assets and liabilities are viewed as homogeneous,capital _____ will _____ interest rates.


A) outflow from Canada;lower Canadian
B) outflow from Britain;lower British
C) outflow from Britain;raise British
D) inflow to Canada;raise Canadian

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