If interest rates are ___, ___ projects will have positive NPV_s. a. higher, more b. lower: more c. lower: no d. none of the above As a result of more favorable economic conditions, there is a(n) ____ demand for loanable funds, causing an ____ shift in the demand curve. a. decreased: inward b. decreased: outward c. increased: outward d. increased: inward Other things being equal, foreign governments and corporations would demand _______ U.S. funds if their local interest rates were lower than U.S. rates. Therefore, for a given set of foreign interest rates, foreign demand for U.S. funds is _______ related to U.S. interest rates. a. less: inversely b. more: positively c. less: positively d. more: inversely The equilibrium interest rate a. equates the aggregate demand for funds with the aggregate supply of loanable funds. b. equates the elasticity of the aggregate demand and supply for loanable funds. c. deceases as the aggregate supply of loanable funds decreases. d. increases as the aggregate demand for loanable funds decreases. If economic expansion is expected to increase, then demand for loanable funds should _______ and interest rates should _____. a. increase: increase b. increase: decrease c. decrease: decrease d. decrease: increase Default risk is likely to be highest for a. short-term Treasury securities. b. AAA corporate securities. c. long-term Treasury securities. d. BBB corporate securities