The Real Interest Rate Is_{--------------------}related to the Supply of Loanable

question 11

Multiple Choice

The real interest rate is_{--------------------}related to the supply of loanable funds because_{--------------------}

• A)negatively; the opportunity cost of consumption expenditure increases as the real interest rate rises
• B)positively; people are motivated to increase their consumption expenditure as the real interest rate rises
• C)negatively; people are motivated to save more as the real interest rate rises
• D)positively; the opportunity cost of consumption expenditure increases as the real interest rate rises
• E)None of the above answers are correct.