Choose the Correct Statement

Choose the correct statement.

A) The long- term real interest rate influences expenditure decisions.
B) In the short run, the supply of loanable funds is influenced by the supply of bank loans.
C) Demand and supply in the loanable funds market determine the long- term real interest rate.
D) A fall in the overnight loans rate that increases the supply of bank loans increases the supply of loanable funds and lowers the equilibrium real interest rate.
E) All of the above are correct.

Correct Answer:

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