Which of the Following Statements Regarding the Loanable Funds Market

question 19

Multiple Choice

Which of the following statements regarding the loanable funds market is not true?

• A) A decrease in a country's net capital outflow shifts the demand for loanable funds to the left.
• B) An increase in domestic investment shifts the demand for loanable funds to the right.
• C) An increase in a country's net capital outflow shifts the supply of loanable funds to the left.
• D) An increase in a country's net capital outflow raises its real interest rate.

---

Definitions:

Releasing Hormones

Hormones secreted by the hypothalamus that stimulate or inhibit the release of hormones from the anterior pituitary.

Hypothalamus

A structure in the forebrain that controls the pituitary gland and so-called homeostatic behaviors such as eating, drinking, temperature control, sleeping, sexual behaviors, and emotional reactions.

Thalamus

A brain structure that acts as a relay station, processing and transmitting information from the senses to the appropriate areas of the brain.

Medulla

A structure in the hindbrain that transmits information from the spinal cord to the brain and regulates life support functions such as respiration, blood pressure, coughing, sneezing, vomiting, and heart rate.