The supply of loanable funds has a ________ slope because the greater the interest rate, the ________ the reward to saving, and the ________ the quantity of loanable funds supplied

A) positive; lesser; lesser
B) positive; greater; lesser
C) negative; lesser; greater
D) positive; greater; greater

Answer: D

Economics

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Within the Keynesian model, if the output of an economy is less than the full-employment level, then

a. a reduction in government expenditures will direct the economy back to full-employment equilibrium. b. a reduction in wage rates and resource prices will quickly restore full-employment equilibrium. c. a reduction in the real interest rate will soon restore full-employment equilibrium. d. output will tend to remain below full-employment capacity unless aggregate expenditures increase.

Economics