Refer to the graph to answer the following questions: Line 1 12 . Line 2 Horizon

Question

Refer to the graph to answer the following questions: Line 1 12 . Line 2 Horizontal Axis Assuming the figure represents the market for loanable funds, and that point C represents $40 million and point D represents $70 million, then it would be true that at interest rate A, the market is in equilibrium. at interest rate A, there is a surplus of $30 million of loanable funds at interest rate A, there is a shortage of $30 million of loanable funds. because there is a disequilibrium at interest rate A, interest rates must fall. the interest rate represented by A must be greater than that represented by B.

Explanation / Answer

Answer
The shortage =Qd-Qs=70-40=30 million
the market is in shortage by 30 million
because the demand is more than supply at interest rate A
option third

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