A country is an international borrower. If the world real interest rate rises, which of the following events will occur in the global loanable funds market?

Question

Accepted Answer

The country decreases its net foreign borrowing.

Answer

The country exits the international loanable funds market.

Answer

The country increases its net foreign borrowing.

Answer

The country does not change its net foreign borrowing.

Answer

The country decreases its domestic demand for loanable funds.

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A country is an international borrower. If the world real interest rate rises, w...

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