Suppose Firms Become More Optimistic About the Economy's Ability to Avoid

question 94

Multiple Choice

Suppose firms become more optimistic about the economy's ability to avoid a recession and hence the expected profit increases.As a result, the demand for loanable funds curve shifts ________ and the real interest rate ________.

• A) rightward; rises
• B) rightward; falls
• C) leftward; rises
• D) leftward; falls
• E) rightward; does not change

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Definitions:

Sender

The person or entity that initiates a message in the communication process, aiming to convey information to a receiver.

Receiver

In communication, the individual or entity that interprets and responds to a message sent by a sender.

Communication Barriers

Obstacles that impede the flow or understanding of information between communicators.

Poor Choice

A decision or selection made that is considered suboptimal or bad in hindsight.