For a given set of foreign interest rates, the quantity of U.S. loanable funds demanded by foreign governments or firms will be ____ U.S. interest rates.
A)positively related to
B)inversely related to
C)unrelated to
D)None of these are correct.

Question

Quizplus · Accepted Answer

The quantity of U.S. loanable funds demanded by foreign governments or firms will be inversely related to U.S. interest rates. This means that as U.S. interest rates increase, the demand for U.S. loanable funds by foreign entities decreases, and vice versa.

For a Given Set of Foreign Interest Rates, the Quantity