Which of the Following Is True? I

question 33

Multiple Choice

Which of the following is true? I.As the real interest rate increases, people increase the quantity they save.
II.The supply of loanable funds curve is downward sloping.
III.As disposable income increases, the supply of loanable funds curve becomes steeper.

• A)II and III only
• B)I only
• C)III only
• D)I and III only
• E)I, II, and III

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Definitions:

Bounded Variable

A variable that has upper and lower limits.

Shadow Price

A monetary value assigned to currently unpriced goods or services, reflecting their worth in terms of opportunity cost or their valuation in a constrained optimization problem.

Reduced Cost

In optimization, it's the difference between the cost of a non-basic variable and its contribution to the objective function, used in linear programming.

Linear Optimization Problems

Mathematical problems concerned with finding the best solution from a set of linear relationships, subject to certain constraints.