When the Real Interest Rate Increases

question 110

Multiple Choice

When the real interest rate increases,

• A) the supply of loanable funds curve shifts rightward.
• B) there is a movement downward along the supply of loanable funds curve.
• C) there is a movement upward along the supply of loanable funds curve.
• D) the supply of loanable funds curve shifts leftward.

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Definitions:

Chapter 7

A provision in the United States bankruptcy code allowing for the liquidation of a debtor's assets to pay off creditors.

Secured Creditors

Creditors who have a legal claim to a debtor's assets as collateral for a debt, giving them a priority position over unsecured creditors in case of bankruptcy.

Liquidation Bankruptcy

A bankruptcy procedure where a debtor's assets are sold off to pay creditors, typically under Chapter 7 in the United States.

Savings and Loan Association

A financial institution that specializes in accepting savings deposits and making mortgage and other loans.