Which of the Following Could Explain an Increase in the Interest

question 180

Multiple Choice

Which of the following could explain an increase in the interest rate and the equilibrium quantity of loanable funds?

• A)The demand for loanable funds shifted rightward.
• B)The demand for loanable funds shifted leftward.
• C)The supply of loanable funds shifted rightward.
• D)The supply of loanable funds shifted leftward.

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Definitions:

Flexible Policy

A strategy that allows for adaptability and change in response to different situations or conditions.

Restrictive Policy

A financial or operational strategy that limits certain actions to control risk or enhance stability within a company or economy.

Operating Cycle

The operating cycle is the time period it takes for a company to purchase inventory, sell it, and convert the sale into cash.

Cash Cycles

The amount of time it takes for a business to convert its investments in inventory and other resources into cash flows from sales.