Question

The slope of the demand for loanable funds curve represents the

Answer 1

Answer: Negative relationship between real interest rate and loanable fund

Explanation:

Loanable funds doctrine explains that forces of demand and supply determines interest rate and loanable funds refers to diverse formsof credit such as loan ,bonds or saving deposit .

A negative relationship between interest rate and Loanable funds denote that the higher the interst rate the lower the credit available and the lower the interest rate ,the more availability of credit (Loanable funds ) .

Answer 2

Answer: Negative Relationship between the interest rate and investment

Explanation: the loanable fund is a type of investment fund and the demand for the investment fund should get affected by the interest rate. If the interest rate increases then the investment or loanable fund decreases so we can say that there is an inverse relationship between the interest rate and the loanable fund. It means there is a negative relationship between the real interest rate and investment