Question

If investors sell their stocks and increase their money holdings due to a bad economy then

1)demand for loanable funds will increase.

2)demand for loanable funds will decrease.

3)supply of loanable funds will increase.

4)supply of loanable funds will decrease.

5)quantity demanded of loanable funds will decrease.

Answer 1

@ddrayer

Answer 2

okay think this one is much more straight forward, if people increase their money holdings that removes money from the loanable fund market (because they're holding it as cash, so they can't loan it!). Thus the supply of loanable funds will decrease.

Answer 3

The first question was right, the second was wrong.. I don't know what the correct answer was though

Answer 4

Bummer! I'm sorry I didn't help, let me know what this answer ended up being :-(

Answer 5

Its alright, you did what you could. Thank you!

Answer 6

I have more questions coming if you're still around

Answer 7

yea for sure!