Multiple Choice
The combined effect on the loanable funds market of a new technology that increases the marginal physical product of capital and a shift in consumers' expectation of future prices, now expecting they will be lower than they earlier expected, is a(n)
A) increase in the interest rate
B) decrease in the interest rate
C) decrease in the quantity demanded and quantity supplied of loanable funds but unclear in what direction the interest rate will change
D) increase in the quantity demanded and quantity supplied of loanable funds but unclear in what direction the interest rate will change
E) shift in the demand curve to the left and the supply curve of loanable funds to the right
Correct Answer:
Verified
Correct Answer:
Verified
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