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