If There Is a Surplus of Loanable Funds,then

question 91

Multiple Choice

If there is a surplus of loanable funds,then

• A)the quantity demanded is greater than the quantity supplied and the interest rate will rise.
• B)the quantity demanded is greater than the quantity supplied and the interest rate will fall.
• C)the quantity supplied is greater than the quantity demanded and the interest rate will rise.
• D)the quantity supplied is greater than the quantity demanded and the interest rate will fall.

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Definitions:

Simple Interest

Interest calculated only on the principal amount, or the original sum of money borrowed or invested, without considering the effect of compounding over time.

Obligations

Duties or commitments that require an individual or organization to act in a certain manner, often legally binding.

Equivalent Replacement

The act or process of replacing an asset with another that performs the same function or yields the same output.

Interest Rate

The percentage of a sum of money charged for its use, typically expressed as an annual percentage rate.