Question

1. Which of the following statements explains why the demand curve in the loanable funds market slopes downward? *

1 point
As the real interest rate increases, lenders are willing to lend more money
As the real interest rate decreases, lenders are willing to lend more money
As the real interest rate increases, borrowers are willing to borrow more money
As the real interest rate increases, borrowers are willing to borrow less money
None of these explanations is appropriate.

Answer 1

I believe the answer is the first one, which is A.

Answer 2

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