Which of the Following Would Most Likely Happen in the Market

question 114

Multiple Choice

Which of the following would most likely happen in the market for loanable funds if the government were to increase the tax on interest income?

• A)Interest rates would rise and savings would fall.
• B)Both interest rates and savings would rise.
• C)Both interest rates and savings would fall.
• D)Interest rates would fall and savings would rise.

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Definitions:

Star Position

A prominent or leading status in a particular field, organization, or group, often characterized by significant influence or visibility.

Coercive Power

A form of power that is based on the ability to deliver punishments or remove privileges to influence behavior.

Legitimate Power

The authority or power that is recognized and accepted by others as right and proper due to the position or role of the person holding it.

Referent Power

A form of influence based on the leader's personal traits and the respect and admiration they inspire in others.