MCQOPTIONS
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| 1. |
Which of the following statements regarding the loanable funds market is not true ? |
| A. | A decrease in a country’s net capital outflow shifts the demand for loanable funds to the left |
| B. | An increase in domestic investment shifts the demand for loanable funds to the right |
| C. | An increase in a country’s net capital outflow shifts the supply of loanable funds to the left |
| D. | An increase in a country’s net capital outflow raises its real interest rate |
| Answer» D. An increase in a country’s net capital outflow raises its real interest rate | |