(Figure: the Loanable Funds Model in the U

Question 67
Multiple Choice

(Figure: The Loanable Funds Model in the U.S. Market) Refer to Figure: The Loanable Funds Model in the U.S. Market. Assume that each country's equilibrium interest rate is 4%. To reconcile the apparent disequilibrium in both markets, assuming that assets and liabilities are viewed as homogeneous, capital _____ will _____ interest rates. A) outflow from the United States; lower U.S. B) outflow from Britain; lower British C) outflow from Britain; raise British D) inflow to the United States; raise U.S.