Which of the Following Best Explains Why There Is a Positive

question 70

Multiple Choice

Which of the following best explains why there is a positive relationship between the interest rate and the supply of households' savings to the financial capital market?

• A)a decrease in the interest rate increases the opportunity cost of current spending,which leads to an increase in desired saving
• B)an increase in the interest rate increases the opportunity cost of current spending,which leads to a decrease in desired saving
• C)an increase in the interest rate increases the opportunity cost of current spending,which leads to an increase in desired saving
• D)an increase in the interest rate causes the investment demand curve to shift up
• E)an increase in the interest rate causes the savings demand curve to shift up

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Definitions:

Unilateral Contract

A promise made by one party in exchange for the performance of an act by another party.

Bilateral Contract

A type of agreement in which both parties involved promise to perform certain actions or obligations.

Consideration

A legal concept referring to something of value exchanged between parties in a contract, making the agreement binding and enforceable.

Unforeseen Circumstances

Events that could not have been predicted or expected and may impact contractual agreements or obligations.