An Increase in the Real Interest Rate the Quantity of Loanable

question 93

Multiple Choice

An increase in the real interest rate the quantity of loanable funds supplied and
The quantity of loanable funds demanded.

• A) decreases; increases
• B) increases; decreases
• C) decreases; decreases
• D) increases; increases

---

Definitions:

Speculative Motive

The desire to hold cash or assets in anticipation of making gains based on future price movements.

Economic Conditions

The state of a country's economy, including factors like unemployment, inflation, and GDP growth.

Gold Reserves

The amount of gold held by a central bank or government to support the value of its currency and to settle debts or engage in trade.

Create Money

The process by which the central bank or financial institutions increase the money supply in the economy, typically through activities such as lending or purchasing government securities.