Business, 14.12.2019 00:31 bwheele6791

Consider a market for loanable funds for an open economy with floating exchange rate. foreign investors in a country become worried about the stability of the government due to its rising debt level. how would it affect equilibrium in the market for loanable funds and exchange rate at the foreign exchange market?

we would expect

a. demand for loanable funds to shift to the right and interest rate to increase
b. demand for loanable funds to shift to the left and interest rate to increase
c. demand for loanable funds to shift to the right and interest rate to decrease
d. demand for loanable funds to shift to the left and interest rate to decrease
e. supply for loanable funds to shift to the right and interest rate to increase
f. supply for loanable funds to shift to the left and interest rate to increase
g. supply for loanable funds to shift to the right and interest rate to decrease
h. supply for loanable funds to shift to the left and interest rate to decrease

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Consider a market for loanable funds for an open economy with floating exchange rate. foreign invest...

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