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Selected transactions completed by a proprietorship are described below. Indicate the effects of each transaction on assets, liabilities, and owner's equity by inserting "+" for increase and "-" for decrease in the appropriate columns at the right. If appropriate, you may insert more than one symbol in a column.
Usury Law
Legislation that sets the maximum interest rate that can be charged on loans, to prevent lenders from imposing excessively high rates.
Market Rate
The prevailing interest rate available in the market for loans or the rate at which other financial instruments are priced, often influenced by the supply and demand for money.
Shortage
A situation where the demand for a product or service exceeds the available supply.
Loanable Funds
The funds available for borrowing in the financial markets, consisting of savings and monies not yet invested, influencing interest rates and investment through supply and demand.
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