1.) The supply of loanable funds is determined primarily by? A. Public savings.
ID: 1127714 • Letter: 1
Question
1.) The supply of loanable funds is determined primarily by?
A.
Public savings.
B.
Savings.
C.
Taxes.
D.
Investment demand.
2.) In the long run, an increase in prices will result in __________ in the amount of goods and services firms produce, ceteris paribus.
A.
An increase.
B.
A decrease.
C.
No change.
3.) If the macro equilibrium is below the full employment level (to the left of the natural rate of output), an increase in aggregate demand will
A.
Decrease prices and decrease output.
B.
Decrease prices and increase output.
C.
Increase prices and decrease output.
D.
Increase prices and increase output.
4.) If the price level falls, we expect
A.
Exports to increase and imports to decrease.
B.
Exports to decrease and imports to increase.
C.
Both exports and imports to increase.
D.
Both exports and imports to decrease.
Explanation / Answer
1.
The main source of a loanable fund are saving. It means the supply of loanable funds is determined primarily by Savings.
Hence option B is the correct answer.
2.
Since the long-run aggregate supply curve is vertical, it means the change in the natural or full-employment real GDP does not depend on the price level in the long run.
Therefore it can be said that In the long run, an increase in prices will result in no change in the number of goods and services firms produce, ceteris paribus.
Hence option C is the correct answer.
3.
If the macro equilibrium is below the full employment level (to the left of the natural rate of output), an increase in aggregate demand will lead to an increase in the price and an increase in the output.
Hence option D is the correct answer.
.
4.) If the price level rise, the domestic goods, and services become expensive relative to the foreign goods and services, it means exports increases and import decreases.
If the price level falls, we expect exports to increase and imports to decrease.
Hence option A is the correct answer.
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.