A decrease in the interest rate due to an increase in the supply of loanable funds is referred to as the __________ effect

Suppose everyone in a small town decided to save more and spend less. How will this affect an economy?

a. It will decrease the overall level of income, since one person’s spending is someone else’s income. b. It will have no impact, since a small town makes up a small portion of an economy. c. It will cause the prices of many goods to increase. d. It will increase the overall level of income, since other groups will spend more.

A major justification for the use of price floors in agriculture was that

a. there were fewer farmers than in the past b. average farm acreage had increased c. demand for food had declined dramatically d. technology dramatically increased supply e. the greenhouse effect increased productivity