An Increase in the Demand for Loanable Funds Would MOST

question 99

Multiple Choice

An increase in the demand for loanable funds would MOST likely be caused by a(n) :

• A) increase in the market interest rate.
• B) increase in business tax rates.
• C) increase in expected business opportunities.
• D) decrease in expected business opportunities.

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Definitions:

Balanced Budget Rule

A fiscal policy regulation requiring that a government's spending does not exceed its income in a given period.

Recession

A period of economic decline across an economy lasting several months, typically recognized by a decrease in GDP, income, employment, and trade.

Price Level

The collective mean of prices for all produced goods and services in the economy at present.

Investment Spending

Expenditures on capital goods by businesses and individuals to add to their capital stock, contributing to future production.