What Is the Supply and Demand for Loanable Funds Equation

question 51

Multiple Choice

What is the supply and demand for loanable funds equation in an open economy?

• A) S = I
• B) S = NX + NCO
• C) S = NCO
• D) S = I + NCO

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Definitions:

Indirect Method

A financial accounting technique used to prepare the cash flow statement, where changes in balance sheet items are adjusted to convert accrual-based net income into cash flow.

Operating Activities

Encompasses the revenue-generating activities of a business, including production, sales, and delivery of the company's product, as well as day-to-day operations.

Statement Of Cash Flows

A financial statement that shows how changes in balance sheet accounts and income affect cash and cash equivalents, dividing cash flows related to operating, investing, and financing activities.

Cost Of Goods

The total expense directly associated with producing goods for sale, including material and labor costs.