-In the Above Figure, the Initial Supply of Loanable Funds

question 141

Multiple Choice

-In the above figure, the initial supply of loanable funds curve is SLF₀ and the initial demand for loanable funds curve is DLF₀. An economic expansion that raises disposable income and the expected profit would

• A) only shift the supply of loanable funds curve rightward to a curve such as SLF₁.
• B) shift the supply of loanable funds curve rightward to a curve such as SLF₁, and shift the demand for loanable funds curve rightward to a curve such as DLF₁.
• C) only shift the demand for loanable funds curve rightward to a curve such as DLF₁.
• D) have no effect on either the demand for loanable funds curve or the supply of loanable funds curve.

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