Asked by
Heather Siegler
on Nov 26, 2024
Verified
Which of the following statements about interest rates is false?
A) Interest rates typically reflect the risk involved in extending a loan.
B) Interest rates are affected by households' spending decisions.
C) The equilibrium interest rate is determined by the intersection of the supply and demand schedules for loanable funds.
D) The supply of loanable funds is independent of the rate of interest.
Loanable Funds
The total quantity of funds available for borrowing in the financial markets, determined by savings and the willingness of individuals and institutions to lend.
Interest Rates
The cost of borrowing money or the return for lending money, typically expressed as a percentage of the principal amount per annum.
- Evaluate the impact of government policies and economic factors on the loanable funds market.
Verified Answer
CM
Learning Objectives
- Evaluate the impact of government policies and economic factors on the loanable funds market.