Suppose Business Decision Makers Become More Optimistic About Future Economic

question 31

Multiple Choice

Suppose business decision makers become more optimistic about future economic conditions and desire additional funds to expand their plant capacity.What is the likely effect on the loanable funds market?

• A)The demand for loanable funds will rise and the interest rate will rise.
• B)The demand for loanable funds will fall and the interest rate will fall.
• C)The supply for loanable funds will rise and the interest rate will fall.
• D)The supply for loanable funds will fall and the interest rate will rise.

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Definitions:

Abstract Conceptual Variable

A variable that represents intangible qualities or ideas that are not directly observable but can still be measured through indirect means.

Death Anxiety

The fear or apprehension about the inevitability of death or the dying process, which can influence personal behavior, beliefs, and psychological well-being.

Independent Variable

The variable that is manipulated or changed in an experiment to test its effects on the dependent variable.

Positive Correlation

A relationship between two variables where an increase in one variable is associated with an increase in the other variable.