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Funds provided by suppliers of funds in financial markets are classified as
Answer & Solution
Correct Answer:
Option
C
Funds provided by suppliers of funds in financial markets are classified as supply of loan-able funds. The supply of loanable funds is based on savings. The demand for loanable funds is based on borrowing. The interaction between the supply of savings and the demand for loans determines the real interest rate and how much is loaned out.
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