If Consumers Decide to Increase Their Rate of Saving, the

question 148

Multiple Choice

If consumers decide to increase their rate of saving, the

• A)supply of loanable funds will decrease
• B)supply of loanable funds will increase
• C)demand for loanable funds will decrease
• D)demand for loanable funds will increase
• E)interest rate will increase

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Definitions:

Interest

The cost of borrowing money, typically expressed as an annual percentage of the principal amount.

Months

Units of time into which a year is divided, normally consisting of 28 to 31 days.

Deposit

A sum of money placed or kept in a bank account, usually to gain interest.

Interest

The charge for borrowing money or the return on investment of saved funds.