Question

An increase in the demand for loanable funds would MOST likely be caused by a(n): increase in the market interest rate. increase in business tax rates. increase in expected business opportunities. decrease in expected business opportunities.

Answer 1

Answer:

It would cause increase or rise in the expected opportunities for business

Explanation:

Loanable funds are those kinds of funds, which is aggregate sum of all the money which the entities and the people in the economy have decided to lend or save out to the borrowers for the purpose of investments instead of using it for the personal consumption.

So, when there is increase in these funds, this will likely to cause the increase in the opportunities for the business as the people of the economy will have the different investment opportunities for lending or saving the money.