Suppose Many Businesses Want to Increase Their Stock of Capital

question 48

Multiple Choice

Suppose many businesses want to increase their stock of capital goods and decide to borrow funds to do it. Which would be the likely result of this event?

• A) Interest rates would increase.
• B) Interest rates would decrease.
• C) The equilibrium quantity of loanable funds would decrease.
• D) The equilibrium quantity of loanable funds would remain unchanged.

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Definitions:

Inferential Statistics

A branch of statistics that makes predictions or inferences about a population based on a sample of data.

Standard Deviation

A measure of dispersion or variability that quantifies the spread or scatter of a set of data points around their mean.

Variance

A statistical measure that indicates the degree of spread or dispersion of a set of values around the mean, showing how much the data points differ from the average.

Variance

A statistical measure that represents the dispersion or spread of a set of data points within a dataset.