Figure 27-1
The figure depicts a demand-for-loanable-funds curve and two supply-of-
loanable- funds curves.
A graph shows a straight line, Demand, decreasing linearly from left to
right, a second straight line, S 1, increasing linearly from left to right, and a
third straight line, S 2, increasing linearly from left to right, to the right of
and parallel to S 1.
Refer to Figure 27-1. Which of the following events would shift the supply
curve from S1 to S2?
a. In response to tax reform, households are encouraged to save
more than they previously saved.
b. Any of the above events would shift the supply curve from S1 to
S2.
c. Government goes from running a balanced budget to running
a budget deficit.
d. In response to tax reform, firms are encouraged to invest more
than they previously invested.
A bond buyer is a
a. borrower. Long-term bonds have less risk than
short- term bonds.
b. saver. Long-term bonds have less risk than
short- term bonds.
c. borrower. Long-term bonds have more risk than
short- term bonds.
d. saver. Long-term bonds have more risk than
short- term bonds.
Which of the following could explain an increase in the equilibrium interest
rate and a decrease in the equilibrium quantity of loanable funds?
a. The demand for loanable funds shifted left.
b. The demand for loanable funds shifted
right. c. The supply of loanable funds
shifted left.
d. The supply of loanable funds shifted right.
, Esther is considering expanding her dress shop. If interest rates rise she
is
The figure depicts a demand-for-loanable-funds curve and two supply-of-
loanable- funds curves.
A graph shows a straight line, Demand, decreasing linearly from left to
right, a second straight line, S 1, increasing linearly from left to right, and a
third straight line, S 2, increasing linearly from left to right, to the right of
and parallel to S 1.
Refer to Figure 27-1. Which of the following events would shift the supply
curve from S1 to S2?
a. In response to tax reform, households are encouraged to save
more than they previously saved.
b. Any of the above events would shift the supply curve from S1 to
S2.
c. Government goes from running a balanced budget to running
a budget deficit.
d. In response to tax reform, firms are encouraged to invest more
than they previously invested.
A bond buyer is a
a. borrower. Long-term bonds have less risk than
short- term bonds.
b. saver. Long-term bonds have less risk than
short- term bonds.
c. borrower. Long-term bonds have more risk than
short- term bonds.
d. saver. Long-term bonds have more risk than
short- term bonds.
Which of the following could explain an increase in the equilibrium interest
rate and a decrease in the equilibrium quantity of loanable funds?
a. The demand for loanable funds shifted left.
b. The demand for loanable funds shifted
right. c. The supply of loanable funds
shifted left.
d. The supply of loanable funds shifted right.
, Esther is considering expanding her dress shop. If interest rates rise she
is
