If the demand for loanable funds increases, what will happen to real interest rates and the international value of the U.S. dollar (USD)?
Real Interest Rates / International Value of USD
Increase / Increase***
Increase / Decrease
Decrease / No Change
Decrease / Decrease
Decrease / Increase
I've done some research and it's actually not decrease/decrease like I thought it would be... but I saw one that said it was the first option because "When Demand increases, R also increases. When the real interest rate increases, the international value of the dollar also increases." Would this be correct?
2 answers
correct.
ok thank you