As a Result of a Recession, the Default Risk Increases

question 125

Multiple Choice

As a result of a recession, the default risk increases. How does this change affect the loanable funds market?

• A)There is a movement up along the supply of loanable funds curve.
• B)There is a leftward shift of the supply of loanable funds curve.
• C)There is a movement down along the demand for loanable funds curve.
• D)There is a rightward shift of the supply of loanable funds curve.
• E)There is a rightward shift of the demand for loanable funds curve.

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