Question : 61) If the real interest rate A) rises, the supply of : 1227787

61) If the real interest rate

A) rises, the supply of loanable funds curve shifts rightward.

B) rises, the supply of loanable funds curve shifts leftward.

C) falls, there is a movement along the supply of loanable funds curve to a higher quantity of saving.

D) falls, there is a movement along the supply curve of loanable funds to a lower quantity of loanable funds .

E) falls, the supply of loanable funds curve shifts leftward.

62) The supply of loanable funds curve has a positive slope because the

A) higher the real interest rate, the lower the return to saving.

B) average return in the stock market is directly related to the real interest rate.

C) lower the real interest rate, the higher the return to saving.

D) lower the real interest rate, the lower the return to saving.

E) quantity of investment increases when the real interest rate increases.

63) If wealth ________, then saving increases, which is shown by a ________.

A) increases; movement upward along the supply of loanable funds curve

B) decreases; a movement downward along the supply of loanable funds curve

C) increases; rightward shift of the supply of loanable funds curve

D) decreases; rightward shift of the supply of loanable funds curve

E) increases; leftward shift of the supply of loanable funds curve

64) Which of the following factors does NOT shift the supply of loanable funds curve?

i.change in disposable income

ii.change in wealth

iii.change in expected profit

A) i only

B) ii only

C) iii only

D) i and ii

E) ii and iii

65) The supply of loanable funds curve has a ________ slope and the demand for loanable funds curve has a ________ slope.

A) positive; positive

B) positive; negative

C) negative; positive

D) negative; negative

E) vertical; horizontal

66) In which of the following cases would the supply of loanable funds curve shift rightward?

A) Joe is worried about cutbacks at his firm so his expected future income falls.

B) In June, Sally learns that at year’s end she will receive a bonus that will double her current salary.

C) The stock market booms so people’s wealth increases.

D) The economy moves into a recession.

E) Investment demand increases.

67) A decrease in households’ disposable income ________ saving supply and the supply of loanable funds curve ________.

A) decreases; shifts rightward

B) decreases; shifts leftward

C) increases; shifts rightward

D) increases; shifts leftward

E) does not change; does not shift

68) An increase in disposable income leads to a

A) leftward shift of the demand for loanable funds curve.

B) downward movement along the supply of loanable funds curve.

C) rightward shift of the supply of loanable funds curve.

D) leftward shift of the supply of loanable funds curve.

E) rightward shift of the demand for loanable funds curve.

69) A decrease in wealth leads to a

A) leftward shift of the demand for loanable funds curve.

B) downward movement along the supply of loanable funds curve.

C) rightward shift of the supply of loanable funds curve.

D) leftward shift of the supply of loanable funds curve.

E) rightward shift of the demand for loanable funds curve.

70) An increase in wealth ________ saving supply and the supply of loanable funds curve ________.

A) decreases; shifts rightward

B) decreases; shifts leftward

C) increases; shifts rightward

D) increases; shifts leftward

E) does not change; does not shift