Market for Loanable Funds

Open Ended

Do you think that you would benefit more from high interest rates, or from low interest rates?

Multiple Choice

If they are depositing money into their checking account, are they...

• A supplier in the market for loanable funds

• A demander in the market for loanable funds

• A middleman in the market for loanable funds

• Not a participant in the market for loanable funds

Multiple Choice

If they are taking out a loan to fund their new business, are they...

• A supplier in the market for loanable funds

• A demander in the market for loanable funds

• A middleman in the market for loanable funds

• Not a participant in the market for loanable funds

Multiple Choice

If they are George Bailey operating his Building And Loan local bank are they...

• A supplier in the market for loanable funds

• A demander in the market for loanable funds

• A middleman in the market for loanable funds

• Not a participant in the market for loanable funds

Multiple Choice

If they are a household stashing money in their piggybank, are they...

• A supplier in the market for loanable funds

• A demander in the market for loanable funds

• A middleman in the market for loanable funds

• Not a participant in the market for loanable funds

Multiple Choice

Where does the supply of funds in the loanable funds market come from?

• Banks printing money

• Firms borrowing money for investment

• Government tax revenues from citizens

• Consumers saving their money at banks

Multiple Choice

The interest rate can be though of as...

• the rate at which banks loan funds

• the return on a capital investment

• the real rate of inflation

• the price of money

Multiple Choice

How will an increase in time preferences affect the loanable funds market? There will be a(n)

• increase in the supply of loanable funds

• decrease in the supply of loanable funds

• increase in the demand of loanable funds

• decrease in the demand of loanable funds

Multiple Choice

In the basic consumption-smoothing model, when are consumers dis-saving?

• During prime earning years

• In theirs 20s and 30s

• Very early in life

• Late in life

Open Ended

Do you think that you would benefit more from high interest rates, or from low interest rates?