In the Figure Above, the Leftward Shift from the Demand

question 22

Multiple Choice

In the figure above, the leftward shift from the demand for loanable funds curve DLF1 to the demand for loanable funds curve DLF3, could be the result of

• A)a fall in the interest rate.
• B)an advancement in technology.
• C)a decrease in expected profit.
• D)an increase in the population.
• E)a rise in the interest rate.

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Definitions:

Profit

The financial gain made in a transaction or operation, calculated as the difference between the revenue earned and the costs incurred.

Short Run

A time period in economic analysis during which at least one factor of production is fixed, influencing the firm's decisions on output and pricing.

Profit

The financial gain realized when the revenue generated from a business activity exceeds the expenses, costs, and taxes needed to sustain the activity.

Competitive Industry

An industry where no single firm has a large market share and each firm must compete on price, quality, and innovation to attract customers.