The quantity of loanable funds demanded increases if the real interest rate falls, all other things remaining the same, because the real interest rate
A) is the opportunity cost of investment.
B) is not related to the price of bonds and stocks.
C) affects the supply of saving which, in turn, determines the quantity of investment.
D) affects the quantity of saving supplied.
E) determines the cost of living.
A
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Assuming a flexible exchange rate, then an expansionary monetary policy in the foreign exchange market will shift
a. the demand curve for foreign exchange to the right b. the demand curve for foreign exchange to the right and the supply curve of foreign exchange to the left. c. both the demand curve for foreign exchange and the supply curve of foreign exchange to the right. d. both the demand curve for foreign exchange to the left. e. none of the above.
Claude's Copper Clappers sells clappers for $65 each in a perfectly competitive market. At its present rate of output, Claude's marginal cost is $65, average variable cost is $45, and average total cost is $67 . To maximize his profit or minimize his loss, Claude should
a. increase output b. reduce output but not to zero c. maintain the present rate of output d. shut down e. raise the price