How Would the Equilibrium Quantity of Loanable Funds Respond to a Change

question 234

Multiple Choice

How would the equilibrium quantity of loanable funds respond to a change from an income tax to a consumption tax?

• A)The equilibrium quantity of loanable funds would rise.
• B)The equilibrium quantity of loanable funds would fall.
• C)The equilibrium quantity of loanable funds would be unaffected.
• D)The equilibrium quantity of loanable funds may rise or fall based on whether household saving increases or decreases as a result of the change from an income tax to a consumption tax.
• E)The equilibrium quantity of loanable funds will initially fall and then return to its initial value.

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Definitions:

Process Manufacturing Systems

Process manufacturing systems refer to the methods and equipment used in industries where products are produced in bulk by chemical, biological, or physical processes.