Suppose the market for loanable funds is in equilibrium. If disposable income increases, the equilibrium real interest rate ________ and the quantity of loanable funds ________
A) falls; increases
B) falls; decreases
C) rises; decreases
D) rises; increases
A
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Long term bonds have ________ interest rate risk
Fill in the blank(s) with the appropriate word(s).
George makes $250 a week working as a student aid. When he cashes his check he takes $100 to the cashiers office to pay part of his tuition. $25 goes to paying off his books, $75 goes for entertainment and $50 he keeps for unexpected expenditures
Which of the following statements is TRUE? A) The transactions demand for money is $125, the precautionary demand is $75 and the asset demand is $50. B) The transactions demand for money is $0, the precautionary demand is $250 and the asset demand is $0. C) The transactions demand for money is $200, the precautionary demand is $50 and the asset demand is $0. D) The transactions demand for money is $250, the precautionary demand is $0 and the asset demand is $0.