Use the Following to Answer Question

question 263

Multiple Choice

Use the following to answer question :
-(Figure: Loanable Funds Market with Government Borrowing) Use Figure: Loanable Funds Market with Government Borrowing.After an increase in government borrowing,the new equilibrium interest rate will rise from 6% to _____%,and the amount of private savings will _____.

• A) 10;stay the same
• B) 8;rise
• C) 8;fall
• D) 10;be indeterminate