The figure shows two demand-for-loanable-funds curves and two supply-of-loanable-funds curves. B C A FL S₂ D₂ S₁ D. Refer to Figure 26-3. A shift of the demand curve from D₁ to D₂ is called an increase in the quantity of loanable funds demanded. a decrease in the demand for loanable funds. O a decrease in the quantity of loanable funds demanded. an increase in the demand for loanable funds.

The figure shows two demand-for-loanable-funds curves and two supply-of-loanable-funds curves. B C A FL S₂ D₂ S₁ D. Refer to Figure 26-3. A shift of the demand curve from D₁ to D₂ is called an increase in the quantity of loanable funds demanded. a decrease in the demand for loanable funds. O a decrease in the quantity of loanable funds demanded. an increase in the demand for loanable funds.

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter21: Financial Markets, Saving, And Investment

Section: Chapter Questions

Problem 6P

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The figure shows two demand-for-loanable-funds curves and two supply-of-loanable-funds curves. B * C D F S₂ D₂ S₁ D₁ Refer to Figure 1. A shift of the supply curve from S 2 to S 1 is called O a. a decrease in the demand for loanable funds. O b. a decrease in the quantity of loanable funds demanded. O c. an increase in the supply for loanable funds. O d. an increase in the quantity of loanable funds supplied.
Figure 26-3. The figure shows two demand-for-loanable-funds curves and two supply-of-loanable-funds curves. S2 D2 D1 Refer to Figure 26-3. A shift of the supply curve from S1 to S2 is called a decrease in the quantity of loanable funds supplied. an increase in the supply of loanable funds. an increase in the quantity of loanable funds supplied. a decrease in the supply of loanable funds. B.
What is the effect of a fall in the real interest rate on the demand for loanable funds? A fall in the real interest rate _______. A. increases the quantity of loanable funds demanded down along the demand curve B. decreases the quantity of loanable funds demanded up along the demand curve C. decreases the demand for loanable funds and shifts the demand curve leftward D. increases the demand for loanable funds and shifts the demand curve rightward
What is the effect of a fall in the real interest rate on the demand for loanable funds? A fall in the real interest rate _______. A. decreases the demand for loanable funds and shifts the demand curve leftward B. decreases the quantity of loanable funds demanded up along the demand curve C. increases the demand for loanable funds and shifts the demand curve rightward D. increases the quantity of loanable funds demanded down along the demand curve Thanks!
U3e the tollowing graph to show the effects on the Market for Loanable Funds of businesses discovering they have more than enough capital to meet the demand for their goods: Instructions: Drag the demand curve to illustrate the appropriate change in demand. Market for Loanable Funds Interest Rate 100 Supply (Savings) 90 80 70 60 50 Demand (Investment) 40 30 20 10 10 20 30 40 50 60 70 80 90 100 Dollar volume of Savings, Investment
Question 31 Figure 26-1 The figure depicts a demand-for-loanable-funds curve and two supply-of-loanable-funds curves. S₁ Demand Refer to Figure 26-1. Which of the following events would shift the supply curve from S₁ to S2? O a. In response to tax reform, firms are encouraged to invest more than they previously invested. O b. In response to tax reform, households are encouraged to save more than they previously saved. c. Government goes from running a balanced budget to running a budget deficit. O d. Any of the above events would shift the supply curve from S₁ to S2.
Suppose the government borrows $20 million more next year than this year. Answer questions d and ea. Draw and fully label a diagram to illustrate the market for loanable fund to analyzethis policy.b. Does the rate of interest rise or fall? c. What happens to investment? To private savings? To public savings? To nationalsavings? d. How does the elasticity of the supply of loanable funds affect the size of thesechanges? e. How does the elasticity of the demand of loanable funds affect the size of thesechanges?
Show the effect on the real interest rate and equilibrium quantity of loanable funds of a decrease in the demand for loanable funds and a smaller decrease in the supply of loanable funds. Draw a demand for loanable funds curve. Label it DLF0. Draw a supply of loanable funds curve. Label it SLF0. Draw a point at the equilibrium real interest rate and quantity of loanable funds. Label it 1. Draw a curve that shows a decrease in the demand for loanable funds. Label it DLF1. Draw a curve that shows a smaller decrease in the supply of loanable funds. Label it SLF1. Draw a point at the new equilibrium real interest rate and quantity of loanable funds. Label it 2.
Using the graph of the loanable funds market below, if the supply of loanable funds increases from SFL and the demand for loanable funds increases from DLF, then the equilibrium interest rate will D'LF DuF Qo Q. Q2 QuF decrease to i2. O remain at i0. increase temporarily and then decrease. O increase to i1.
In the loanable funds market, if firms become more optimistic about future profitability, then the a demand for loanable funds will increase, interest rates will increase, and private sector investment spending will increase. b demand for loanable funds will decrease, interest rates will decrease, and the equilibrium quantity of borrowing will decrease. c supply of loanable funds will increase, interest rates will decrease, and the equilibrium quantity of borrowing will increase. d supply of loanable funds will increase, interest rates will increase, and private sector investment spending will increase.
Which of the following reasons could cause the demand curve for loanable funds to shift to the right from DLF to D¹LF in the figure? Wage $11 8 X 3400 2700 D 4500 Quantity of labor The economy is expected to boom, thereby increasing investment returns. O Larger investment projects with potentially higher returns get funded. Falling interest rates make it less expensive for firms to borrow. Rising interest rates make it more attractive for savers to save.
Over time how do changes in the demand for loanable funds and the supply of loanable funds change the real interest rate? Over time,_______. A. the demand for loanable funds trends downward, the supply of loanable funds trends upward, and the real interest rate trends upward. B. both the demand for loanable funds and the supply of loanable funds trend upward, and the real interest rate also trends upward. C. the demand for loanable funds trends upward, the supply of loanable funds trends downward, and the real interest rate trends upward. D. both the demand for loanable funds and the supply of loanable funds trend upward, but the real interest rate has no trend.