The Unintended Consequences of an Economic Change That Are Not

question 34

Multiple Choice

The unintended consequences of an economic change that are not immediately identifiable but are felt only with time are known in economics as

• A) opportunity costs.
• B) marginal effects.
• C) secondary effects.
• D) scarcity constraints.

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Definitions:

Business Borrowing

The act of obtaining funds by businesses from external sources like banks or financial institutions to finance operations or investments.

Loanable Funds

The total quantity of funds available for borrowing in the financial markets, determined by savings and the willingness of individuals and institutions to lend.

Interest Rates

The cost of borrowing money or the return for lending money, typically expressed as a percentage of the principal amount per annum.

Loanable Funds

The sum of money available for borrowing in the financial markets, where interest rates adjust to match supply and demand.