-In the figure above, the leftward shift from the demand for loanable funds curve DLF₁ to the demand for loanable funds curve DLF₃, could be the result of
A) a decrease in interest rates during an economic recession.
B) a increase in interest rates during an economic expansion.
C) the economy entering a recession.
D) a government budget surplus.
E) the economy entering an expansion.

Question

-In the figure above, the leftward shift from the demand for loanable funds curve DLF₁ to the demand for loanable funds curve DLF₃, could be the result of
A) a decrease in interest rates during an economic recession. 
B) a increase in interest rates during an economic expansion. 
C) the economy entering a recession. 
D) a government budget surplus. 
E) the economy entering an expansion.

Quizplus · Accepted Answer

During a recession, businesses and consumers are less likely to borrow, leading to a decrease in the demand for loanable funds, causing a leftward shift in the demand curve.

-In the Figure Above, the Leftward Shift from the Demand