Which of the Following Explains Why the Demand for Loanable

question 16

Multiple Choice

Which of the following explains why the demand for loanable funds is negatively related to the real interest rate?

• A) A lower real interest rate makes more investment projects profitable.
• B) Consumers are willing to spend less and hence save more at higher real interest rates.
• C) Interest rate flexibility in financial markets assures an equilibrium in which saving equals investment.
• D) All of the above are reasons why the demand for loanable funds is negatively related to the real interest rate.

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Definitions:

Southern Christian Leadership Conference

An African American civil rights organization founded in 1957, closely associated with Dr. Martin Luther King Jr., which played a major role in the civil rights movement.

Mississippi's Black Adults

A demographic group referring to African American adults residing in the state of Mississippi, potentially focusing on their social, economic, or political conditions.

Registered To Vote

The status of having one's name officially listed to participate in elections and vote.

Sit-In

A form of protest in which individuals occupy an area, refusing to leave until their demands are met, historically used in civil rights movements to protest segregation.