Which of the following will cause the supply curve of loanab

Which of the following will cause the supply curve of loanable funds to shift?

a) Incentives to save.

b) Business expectations.

c) Product demand.

d) Investment tax incentives.

Suppose Congress enacts investment tax credits to spur more business investment. What impact would this have on the loanable funds market?

a) There would be an increase in supply; the supply curve shifts right.

b) There would be a decrease in supply; the supply curve shifts left.

c) There would be an increase in demand; the demand curve shifts right.

d) There would be a decrease in demand; the demand curve shifts left.

Financial intermediaries that primarily accept savings and make loans are known as:

a) commercial banks.

b) credit cards.

c) federal financial regulators.

d) securities firms.

In the figure below, if the interest rate is 2%, the supply of loanable funds (savings) ________ the demand for loanable funds (borrowing).

a) is greater than

b) is less than

c) is equal to

d) randomly fluctuates around

5 So 0 3 0 0 00 200 300 400 500 600 Loanable Funds (billions of dollars)

Solution

Ans 4)

For interest rate 2% supply curve is lower than demand curve hence lower than is correct answer

Option B is correct

Which of the following will cause the supply curve of loanable funds to shift? a) Incentives to save. b) Business expectations. c) Product demand. d) Investment

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