Using the graph of the loanable funds market below, if the supply of loanable funds increases from SFL and the demand for loanable funds increases from DLF, then the equilibrium interest rate will SuF S'F to D'LF Du Qo O decrease to i2. O remain at i0. O increase temporarily and then decrease.
Using the graph of the loanable funds market below, if the supply of loanable funds increases from SFL and the demand for loanable funds increases from DLF, then the equilibrium interest rate will SuF S'F to D'LF Du Qo O decrease to i2. O remain at i0. O increase temporarily and then decrease.
Chapter21: Financial Markets, Saving, And Investment
Section: Chapter Questions
Problem 6P
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