-In the Above Figure, the Economy Is at Point a on the Initial

question 178

Multiple Choice

-In the above figure, the economy is at point a on the initial supply of loanable funds curve SLF₀. What happens if the interest rate rises?

• A) There is a movement to a point such as b on supply of loanable funds curve SLF₀.
• B) The supply of loanable funds curve shifts rightward to a curve such as SLF₂.
• C) The supply of loanable funds curve shifts leftward to a curve such as SLF₁.
• D) none of the above

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