If the Aggregate Demand for Loanable Funds Increases Without a Corresponding

question 31

Multiple Choice

If the aggregate demand for loanable funds increases without a corresponding ____ in aggregate supply, there will be a ____ of loanable funds. ​

• A)increase; surplus
• B)increase; shortage
• C)decrease; surplus
• D)decrease; shortage

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Definitions:

Stockholders

Individuals or entities that own shares in a corporation, giving them an ownership stake.

Firm's Managers

Individuals responsible for making significant corporate decisions and managing the overall operations and resources of a business.

Capital Budgeting

The process by which a business determines and evaluates potential expenses or investments that are significant in amount.

Project Cash Flows

Refers to the net amount of cash being transferred into and out of a project, considering all revenues, expenses, and capital costs over its life.