An increase in the demand for loanable funds will occur if there is A. an increase in the real interest rate. B. an increase in the nominal interest rate accompanied by an equal increase in inflation. C. a decrease in the real interest rate. D. an increase in expected profits from firm investment projects.

The correct answer is letter "D":  an increase in expected profits from firm investment projects.

Explanation:

The market of loanable funds represents the fluctuations in the borrowing of a market. The demand for loanable funds depends on borrowing as well. Two main factors cause changes in the demand for loanable funds: changes in the expected Rate of Return (RoR) on investment spending and government policies.

In this scenario, the real interest rate follows the trend of the market. It implies if the RoR on investments increases, the real interest rate will increase as well. If the economy is underperforming, the real interest rate will decrease.

hi i’m a student too and i’ve had this app downalodes for a few weeks people do answer it you just gotta be patient and what is your question + subject i’ll you?

answer(b) equal; set period;