Refer to Figure 21-6. The loanable funds market is in equilibrium, as shown in the figure above
An increase in the supply of loanable funds could result in which of the following combinations of the real interest rate and quantity of loanable funds at a new equilibrium?
A) The real interest rate is 3 percent, and the quantity of loanable funds is $90 million.
B) The real interest rate is 3 percent, and the quantity of loanable funds is $150 million.
C) The real interest rate is 5 percent, and the quantity of loanable funds is $90 million.
D) The real interest rate is 5 percent, and the quantity of loanable funds is $150 million.
B
You might also like to view...
Short-run macroeconomic equilibrium occurs when the quantity of real GDP demanded ________
A) equals potential GDP B) equals full-employment GDP C) does not equal full-employment GDP D) equals the quantity of real GDP supplied
Assume a closed economy, that taxes are fixed, and the marginal propensity to consume is equal to 0.8. What is the government spending multiplier?
A) 10 B) 5 C) 4 D) 3