If the supply of loanable funds shifts right,then the equilibrium
A)levels of net capital outflow and domestic investment decrease.
B)level of net capital outflow increases and the equilibrium level of domestic investment decreases.
C)level of net capital outflow decreases and the equilibrium level of domestic investment increases.
D)levels of net capital outflow and domestic investment increase.

Question

Quizplus · Accepted Answer

When the supply of loanable funds shifts right, it indicates an increase in the availability of funds for borrowing. This typically leads to lower interest rates, which encourages both domestic investment and net capital outflow, as borrowing becomes cheaper.

If the Supply of Loanable Funds Shifts Right,then the Equilibrium