If There Is Shortage of Loanable Funds, Which of the Following

question 142

Multiple Choice

If there is shortage of loanable funds, which of the following is most likely to happen?

• A)The supply for loanable funds shifts right and the demand shifts left.
• B)The supply for loanable funds shifts left and the demand shifts right.
• C)Neither curve shifts, but the quantity of loanable funds supplied increases and the quantity demanded decreases as the interest rate rises to equilibrium.
• D)Neither curve shifts, but the quantity of loanable funds supplied decreases and the quantity demanded increases as the interest rate falls to equilibrium.

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Definitions:

General Ledger

A comprehensive record of all financial transactions that occur within a company, organized by account.

Sales Journal

A specialized accounting journal used to record all sales of goods and services on credit.

Sales Revenue

The total amount of money a company receives from its sales of goods or services before any expenses are subtracted.

Cross-Footing

A bookkeeping process that involves checking the mathematical accuracy of figures in financial statements by ensuring that sums of columns and rows respectively match.