Suppose the real interest rate rises and the quantity of loanable funds decreases. These changes could have been the result of
A) firms expecting higher future profits.
B) an increase in disposable income.
C) an increase in household wealth.
D) a decrease in the default risk.
C
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Refer to the information below. The normal profits for Harvey in the first year were:
Harvey quit his job at State University where he earned $45,000 a year. He figures his entrepreneurial talent or foregone entrepreneurial income to be $5,000 a year. To start the business, he cashed in $100,000 in bonds that earned 10 percent interest annually to buy a software company, Extreme Gaming. In the first year, the firm sold 11,000 units of software at $75 for each unit. Of the $75 per unit, $55 goes for the costs of production, packaging, marketing, employee wages and benefits, and rent on a building. A. $5,000 B. $160,000 C. $220,000 D. $780,000
Which of the following is the best example of the concept of "complement"?
A. Coke and Pepsi B. Ramen noodles C. Hot dogs and hot dog buns D. SUVs