-In Exhibit Q-7, the Equilibrium Rate of Interest Is _____

Multiple Choice

-In Exhibit Q-7, the equilibrium rate of interest is _____ because at that rate __________.

A) 10 percent; the quantity supplied equals the quantity demanded
B) 6 percent; demanders are encouraged to borrow and thus invest the most
C) 14 percent; suppliers are encouraged to save the most
D) 10 percent; firms maximize their profit
E) unknown; not enough information is given