The Following Figure Shows Two Credit Demand Curves, CD₁ and CD₂

question 122

Multiple Choice

The following figure shows two credit demand curves, CD₁ and CD₂, and two credit supply curves, CS₁ and CS₂.

-Refer to the figure above.What is the equilibrium quantity of credit when the credit demand curve is CD₁ and the credit supply curve is CS₁?

• A) $20
• B) $30
• C) $40
• D) $50

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Definitions:

Annual Rate

Annual rate, often used in the context of loans and investments, refers to the percentage that signifies the yearly cost of funds or the yearly return on investment.

Annual Rate

Typically refers to the interest rate for a whole year, as opposed to a shorter period, on a loan, investment, or deposit.

Borrowed

Refers to funds or resources obtained temporarily from another party, usually with the promise of repayment plus interest.

Final Payment

The last installment paid in a series of payments, concluding the payment obligation under a financial agreement.