As the real interest rate falls: the supply of loanable funds decreases. more saving is supplied...

As the real interest rate falls:

	the supply of loanable funds decreases.
	more saving is supplied to the market.
	the quantity supplied of loanable funds decreases.
	the supply of loanable funds increases.

Which of these is NOT a way financial institutions reduce risk?

	diversifying funds
	collecting information helpful for risk assessment
	performing credit checks on borrowers
	guaranteeing a high rate of return for all lenders

Solutions

Expert Solution

1 ] . ANSWER OF THE ABOVE ASKED QUESTION IS OPTION '' D ''

AS THE REAL INTEREST RATE FALLS

THE SUPPLY OF THE LOANABLE FUNDS INCREASES .

When there is the change in the profit which is expected then the demand for the fund which is loanable changes .

2] . ANSWER OF THE ABOVE ASKED QUESTION IS OPTION '' D ''

WHICH OF THESE IS NOT A WAY FINANCIAL INSTITUTION REDUCE RISK ?

GUARANTEEING A HIGH RATE OF RETURN FOR ALL LENDERS .

Financial institution are the type of institution who provides finance , also facilitate the transaction of economic offer the insurance and also holds the deposits .

Rahul Sunny answered 2 years ago

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