According to the Loanable Funds Approach to Interest Rate Determination,the

question 3

Multiple Choice

According to the loanable funds approach to interest rate determination,the supply curve slopes up because:

• A) the lower the interest rates, the more loanable funds will be supplied.
• B) higher interest rates reduce the inflation rate.
• C) a rise in interest rates makes lenders more willing to supply funds.
• D) when bond prices are high, more loanable funds will be supplied.

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Definitions:

Standard Cost

A predetermined cost of manufacturing, delivering, or producing goods under normal conditions.

Standard Cost System

An accounting system that estimates the cost of products in advance, using standard rates for materials and labor.

Direct Labor-Hours

The hours worked by employees directly involved in manufacturing goods, which is used as a basis for assigning labor costs to products.

Fixed Manufacturing Overhead

The portion of total manufacturing overhead costs that remains constant regardless of the level of production or activity volume.