If expectations about the future don't change at all, then an economic downturn will generally:
A. increase savings at a given interest rate and shift the supply curve for loanable funds to the right.
B. decrease savings at a given interest rate and shift the supply curve for loanable funds to the right.
C. decrease savings at a given interest rate and shift the supply curve for loanable funds to the left.
D. increase savings at a given interest rate and shift the supply curve for loanable funds to the left.
Answer: C
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Which of the following statements is true?
A) If both demand and supply increase there must be an increase in equilibrium price; equilibrium quantity may either increase or decrease. B) An increase in supply causes a change in equilibrium price; the change in price does not cause a further change in demand or supply. C) If demand decreases and supply increases one cannot determine if equilibrium price will increase or decrease without knowing which change is greater. D) A decrease in supply causes equilibrium price to rise; the increase in price then results in a decrease in demand.
The trade feedback effect refers to the tendency for an increase in the economic activity in one country to lead to a worldwide in economic activity, which then feeds back to the first country.
Answer the following statement true (T) or false (F)