In a Credit Crunch

question 199

Multiple Choice

In a credit crunch:

• A)interest rates are so low that savers decrease the quantity of available loanable funds.
• B)borrowers are forced to pay very high interest rates or may not be able to borrow at all.
• C)unemployment is usually very low and the growth rate of output is very high.
• D)the spread becomes negative.

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Definitions:

Danish Krone

The official currency of Denmark, often represented by the symbol DKK.

Danish Cookies

Delicious sweet biscuits originating from Denmark, often enjoyed during holidays and special occasions, frequently coming in a tin box.

Brazilian Real

The official currency of Brazil, represented symbolically as R$ and subdivided into 100 centavos.

Invoice

A document from a seller requesting payment from the buyer; the supplier’s bill.