If the Government Imposes an Interest Rate Ceiling Below the Equilibrium

question 12

Multiple Choice

If the government imposes an interest rate ceiling below the equilibrium interest rate in the loanable funds market,then:

• A) the quantity of savings supplied will be less than the quantity of loanable funds demanded.
• B) the quantity of savings supplied will be more than the quantity of loanable funds demanded.
• C) the quantity of savings supplied will be equal to the quantity of loanable funds demanded.
• D) the quantity of savings supplied and the quantity of loanable funds demanded will not be affected.

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Definitions:

Notice-And-Comment Rulemaking

A regulatory process that requires agencies to publish proposed rules, accept public comments, and consider those comments before finalizing regulations.

Binding Legal Effect

The characteristic of a document, contract, or agreement that makes it legally enforceable by being properly executed according to the law.

Final Rule

The last version of a rule or regulation issued by a government agency after consideration of public comments and review.

Administrative Process

The procedures and operations involved in running an organization, government, or institution, including tasks such as filing, record-keeping, and policy implementation.