The Loanable Funds Theory of Interest Shows That Interest Rates

question 145

Multiple Choice

The loanable funds theory of interest shows that interest rates on loans are determined by

• A)the amount of money supply that the government has pumped into the economy.
• B)agreement, explicit or tacit, among the bank lending officers.
• C)supply and demand for funds available for lending.
• D)government analysts and government regulation.