Which of the following is true?
I. As the real interest rate increases, people increase the quantity they save.
II. The supply of loanable funds curve is downward sloping.
III. As disposable income increases, the supply of loanable funds curve becomes steeper.
A) II and III
B) III only
C) I only
D) I and III

Question

Quizplus · Accepted Answer

None of the statements are true. Option I is incorrect because as the real interest rate increases, people decrease the quantity they save. Option II is incorrect because the supply of loanable funds curve is upward sloping. Option III is incorrect because as disposable income increases, the supply of loanable funds curve becomes flatter.

Which of the Following Is True