If Consumers Expect to Have a Shorter Life Expectancy and Desire

question 26

Multiple Choice

If consumers expect to have a shorter life expectancy and desire to save less,then the:

• A) demand for loanable funds will increase and the equilibrium interest rate will increase.
• B) demand for loanable funds will decrease and the equilibrium interest rate will decrease.
• C) supply of loanable funds will decrease and the equilibrium interest rate will increase.
• D) the supply of loanable funds will increase and the equilibrium interest rate will decrease.

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Definitions:

High Value

Referring to items or services deemed of significant worth, usually due to their quality, utility, scarcity, or demand.

Low Value

Refers to items or services that are considered to be of lesser worth or importance, either monetarily or in terms of utility.

Expected Profit

An estimate of the potential earnings from an investment or business venture, incorporating the likelihood of different outcomes.

Customers

The individuals or businesses that purchase goods or services offered by companies or sellers.