Which of the Following Would Necessarily Create a Surplus at the Original

question 75

Multiple Choice

Which of the following would necessarily create a surplus at the original equilibrium interest rate in the loanable funds market?

• A)an increase in the supply of or a decrease in the demand for loanable funds
• B)an increase in the supply of or an increase in the demand for loanable funds
• C)a decrease in the supply of or a decrease in the demand for loanable funds
• D)a decrease in the supply of or an increase in the demand for loanable funds

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Definitions:

Payable to Order

A phrase indicating that a financial instrument, such as a check, is transferable to a specific person or entity mentioned in the document.

Negotiable

Referring to the ability of the terms of an agreement, document, or financial instrument to be adjusted or transferred in accordance with all parties' consent.

Certificates of Deposit

Financial instruments issued by banks that offer a fixed interest rate in exchange for keeping deposited funds untouched for a predetermined period.

Nonnegotiable

Pertaining to a term, condition, or instrument that cannot be altered or bargained upon, often legally or contractually fixed.