If There Is Shortage of Loanable Funds, Then

question 78

Multiple Choice

If there is shortage of loanable funds, then

• A) the supply for loanable funds shifts right and the demand shifts left.
• B) the supply for loanable funds shifts left and the demand shifts right.
• C) neither curve shifts, but the quantity of loanable funds supplied increases and the quantity demanded decreases as the interest rate rises to equilibrium.
• D) neither curve shifts, but the quantity of loanable funds supplied decreases and the quantity demanded increases as the interest rate falls to equilibrium.

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