In the Loanable Funds Market

question 86

Multiple Choice

In the loanable funds market,

• A)The price is the interest rate.
• B)The demand curve reflects the behavior of lenders.
• C)The supply curve reflects the behavior of borrowers.
• D)If interest rates rise,firms borrow more.

---

Definitions:

Working Capital

The difference between a company's current assets and current liabilities, indicating the liquidity available to fund operations.

Current Ratio

A financial metric assessing a firm's capability to meet its short-term debts, determined by dividing its current assets by its current liabilities.

Days' Sales

The metric used to evaluate how efficiently a company can convert its inventory into sales, often expressed as days' sales in inventory.

Receivables

All money claims against other entities, including people, business firms, and other organizations.