The Source of the Supply of Loanable Funds Is

question 146

Multiple Choice

The source of the supply of loanable funds is

• A)saving,and the source of the demand for loanable funds is investment.
• B)consumption,and the source of the demand for loanable funds is investment.
• C)investment,and the source of the demand for loanable funds is saving.
• D)the interest rate,and the source of the demand for loanable funds is saving.

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Definitions:

One-Line Consolidation

A method of including a subsidiary's information in a parent company's financial statements by a single line representing the investment's net value.

Consolidation

The process of combining the financial statements of a parent company with those of its subsidiaries to present the accounts as if the group of companies was a single entity.

Cost Method

An accounting technique used to record investments at their original purchase cost, adjusting for dividends received and not for changes in market value.

Equity Method

An accounting method for recording investments in which the investor recognizes income from the investee in proportion to its share of the investee’s profit or loss.