The Equilibrium Interest Rate Should

question 26

Multiple Choice

The equilibrium interest rate should

• A)fall when the aggregate supply of funds exceeds the aggregate demand for funds.
• B)rise when the aggregate supply of funds exceeds the aggregate demand for funds.
• C)fall when the aggregate demand for funds exceeds the aggregate supply of funds.
• D)rise when the aggregate demand for funds equals the aggregate supply of funds.
• E)rise when the aggregate supply of funds exceeds the aggregate demand for funds AND fall when the aggregate demand for funds exceeds the aggregate supply of funds.

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Definitions:

Selling Shares

The act of offering ownership interests in a corporation to investors in exchange for capital.

Investment Revenue

Income earned from various forms of investments like stocks, bonds, mutual funds, or rental properties.

Unearned Revenues

Money received by a business for services or products that have not yet been provided or delivered to the customer.

Sales Revenue

The revenue a company earns from selling products or delivering services.