Figure 26-4

question 342

Multiple Choice

Figure 26-4. On the horizontal axis of the graph, L represents the quantity of loanable funds in billions of dollars.
-Refer to Figure 26-4. Regard the position of the Supply curve as fixed, as on the graph. If the real interest rate is 8 percent, the inflation rate is 3 percent, and the market for loanable funds is in equilibrium, then the position of the demand-for-loanable-funds curve must be

• A) D₁.
• B) D₂.
• C) between D₁ and D₂.
• D) to the right of D₂.

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Definitions:

Permissive

A parenting style characterized by low demands with high responsiveness, where parents are very lenient and mostly allow their children to do what they want.

Authoritarian

relating to a system of government or leadership style characterized by concentrated power in the hands of a leader or a small elite not constitutionally responsible to the people.

Total Isolation

A condition or situation in which an individual is completely separated from others, leading to various psychological and physiological effects.

Fearful

Fearful denotes a feeling of anxiety or apprehension caused by the presence or anticipation of danger.