Author Question: If the supply of loanable funds curve shifts rightward from the curve shown in the figure above, the ... (Read 221 times)

TVarnum · **on:** Jun 29, 2018

If the supply of loanable funds curve shifts rightward from the curve shown in the figure above, the shift could be the result of

A) a decrease in the demand for loanable funds.
B) a decrease in disposable income.
C) a decrease in the supply of loanable funds.
D) a fall in expected future income.
E) an increase in wealth.

Question 2

According to the natural rate hypothesis, if the economy begins at full employment with an unemployment rate of 5 percent and then the inflation rate increases from 2 percent to 4 percent, then the economy will

A) not see any lower unemployment, even temporarily, just higher inflation.
B) have lower unemployment but then return to its natural rate with an inflation rate of 4 percent.
C) eventually return to its natural rate of 2 percent inflation and its natural unemployment rate of 5 percent.
D) eventually return to its natural rate of 2 percent inflation and a new lower unemployment rate.
E) stay at the 4 percent inflation rate and the natural unemployment rate will fall.