1. If there is surplus of loanable funds, what is most likely to happen?

a. Neither curve shifts, but the quantity of loanable funds supplied increases and the quantity demanded decreases as the interest rate rises to equilibrium.

b. The supply for loanable funds shifts left and the demand shifts right.

c. The supply for loanable funds shifts right and the demand shifts left.

d. Neither curve shifts, but the quantity of loanable funds supplied decreases and the quantity demanded increases as the interest rate falls to equilibrium.

2. In a closed economy, what does (Y - G - C) represent?

a. government tax revenue

b. national saving

c. public saving

d. private saving

3. Noel is considering expanding his bike shop. What will happen if interest rates fall?

a. He is more likely to expand. This illustrates why the demand for loanable funds slopes downward.

b. He is less likely to expand. This illustrates why the supply of loanable funds slopes downward.

c. He is more likely to expand. This illustrates why the supply of loanable funds slopes upward.

d. He is less likely to expand. This illustrates why the demand for loanable funds slopes downward.

4. How is the unemployment rate computed?

a. by counting the number of working-age persons who don't have a job

b. by counting the number of employment insurance applications filed

c. by determining the number of unemployed in the population aged 18 and older

d. by dividing the number of unemployed by the number of persons in the labour force

5. If other things are the same, will countries that tax less on saving have lower or higher interest rates and investment than other countries?

a. lower interest rates and lower investment

b. higher interest rates and higher investment

c. higher interest rates and lower investment

d. lower interest rates and higher investment

6. If Parliament instituted an investment tax credit, what would most likely happen to the interest rate and saving?

a. The interest rate would fall, and saving would rise.

b. The interest rate would rise, and saving would rise.

c. The interest rate would rise, and saving would fall.

d. The interest rate would fall, and saving would fall.