객관식
In the open-economy macroeconomic model, which of the following correctly represents the market for loanable funds identity?
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13. The Financial System
Market for Loanable Funds
객관식
How does the market for loanable funds work?
A
It is a market where banks set a fixed interest rate and allocate loans by administrative quotas, so the quantity of loans is determined by regulation rather than by saving and investment.
B
It is a market where government budget deficits increase the supply of loanable funds, which lowers the interest rate and thereby crowds in private investment.
C
It is a market where the central bank directly matches lenders and borrowers and controls loan quantities, so private saving has little effect on the equilibrium interest rate.
D
It is a market where the supply of loanable funds comes from national saving and the demand comes from borrowers who want to invest; the interest rate adjusts to equilibrate saving and investment.
검증된 단계별 안내1
Understand that the market for loanable funds is a conceptual framework used to analyze how saving and investment interact through the interest rate.
Identify the supply side of the market: the supply of loanable funds comes from national saving, which includes both private saving and public saving.
Identify the demand side of the market: the demand for loanable funds comes from borrowers who want to invest in capital projects.
Recognize that the interest rate acts as the price of loanable funds, adjusting to balance the quantity of funds saved and the quantity of funds invested.
Conclude that the equilibrium interest rate is determined where the supply of loanable funds equals the demand for loanable funds, ensuring that saving equals investment in the economy.
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