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avanturin [10]
3 years ago
7

The equilibrium interest rate a. equates the aggregate demand for funds with the aggregate supply of loanable funds. b. equates

the elasticity of the aggregate demand and supply for loanable funds. c. decreases as the aggregate supply of loanable funds decreases.
Business
1 answer:
FromTheMoon [43]3 years ago
7 0

Answer:

The correct answer is option a.

Explanation:

The equilibrium interest rate is determined by the interaction of aggregate demand for loanable funds and aggregate supply of loanable funds. In other words, at the level of equilibrium interest rate, the aggregate demand for loanable funds is equal to aggregate supply of loanable funds. Any change in these two variable causes the equilibrium interest rate to change.

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b. If not, how should he rearrange his spending?

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