An Increase in the Real Interest Rate

question 147

Multiple Choice

An increase in the real interest rate

• A)has no effect on the loanable funds.
• B)increases current consumption.
• C)shifts the supply of loanable funds curve rightward.
• D)decreases the quantity of loanable funds supplied.
• E)increases the quantity of loanable funds supplied.

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Definitions:

Earnings Per Share

A company’s net income divided by the number of its outstanding shares, indicating the portion of a company’s profit allocated to each outstanding share of common stock.

Common-size Statement

A financial statement in which all line items are expressed as a percentage of a base figure within the statement, facilitating comparison across different periods or companies.

Liability Accounts

Accounts on a company's balance sheet that represent the company's obligations to others, including loans, accounts payable, mortgages, and accrued expenses.

Total Assets

The sum of all assets owned by a company, including cash, inventory, property, and equipment, reflected on the balance sheet.