Question

1. which of the following will cause the demand of loanable funds curve to shift rightward?

A) businesses are more confident in the future of the economy

B) household’s wealth increases

C) an increase in government regulations that make plant expansion difficult

D) an increase in asset prices leading to a decrease in purchases of stocks and bonds

2. which of the following will cause the supply of loanable funds curve to shift rightward?

A) An increase in the government deficit

B) Lowering of firms’ expectations about the economy

C) An increase in government regulations that make plant expansion difficult

D) workers fear that unemployment will increase

Answer 1

1. A) Businesses are more confident in the future of the economy.

2. B)  Lowering of firms’ expectations about the economy.