Which Event Could Be Expected to Shift a Nation's Demand

question 3

Multiple Choice

Which event could be expected to shift a nation's demand for loanable funds, as shown in the accompanying graph?

• A) an increase in the productivity of capital
• B) a decrease in investor confidence
• C) an increase in consumer wealth
• D) an increase in time preferences
• E) a rise in the number of workers in their prime earning years

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Definitions:

Optimal Choice

The most efficient allocation of resources or decision making that maximizes benefit or utility for an individual or entity.

Twizzlers

A brand of fruit-flavored candy in the form of twisted ropes, known for its chewy texture.

Normal Good

A good whose demand increases when consumer income rises and decreases when consumer income falls, ceteris paribus.

Consumer

A person or collective that buys products or services for their own consumption and not for making or selling them.