In the Open-Economy Macroeconomic Model,the Supply of Loanable Funds Comes

question 115

Multiple Choice

In the open-economy macroeconomic model,the supply of loanable funds comes from

• A)the sum of domestic investment and net capital outflow.
• B)net capital outflow alone.
• C)domestic investment alone.
• D)None of the above is correct.

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Definitions:

Inferior Good

A type of good for which demand decreases as the income of individuals increases, conversely, its demand increases when consumer income declines.

Inferior Good

A type of good for which demand decreases as the income of consumers increases, contrasting with normal goods.

Normal Good

A good for which demand increases when consumer income rises, and decreases when consumer income falls.

Inferior Good

A category of products whose demand falls when consumer income rises, showing an inverse relationship with changes in income.