Consider the Market for Loanable Funds in the Long Run

question 20

Multiple Choice

Consider the market for loanable funds in the long run. The national saving curve is upward sloping because an increase in the real interest rate

• A)decreases the supply of private saving.
• B)leads households to reduce their current consumption.
• C)leads to an increase in investment demand.
• D)decreases the supply of public saving.
• E)leads households to increase their current consumption.