When interest rate is higher than equilibrium rate of borrowing loanable funds then financial system has
A. short-term funds
B. long-term funds
C. surplus of funds
D. deficit of funds
Answer: Option C
Solution(By Examveda Team)
When interest rate is higher than equilibrium rate of borrowing loanable funds then financial system has surplus of funds. The demand for loanable funds represents the behavior of borrowers and the quantity of loans demanded. The lower the interest rate, the less expensive it is to borrow.This Question Belongs to Management >> International Finance And Treasury
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