Supply and Demand for loanable funds I already answered the first two blanks. I

Question

Supply and Demand for loanable funds

I already answered the first two blanks. I need help with the rest. The options given for the rest of the blanks are 1) greater or less 2) surplus or shortage 3) raise or lower 4) increasing or decreasing 5) increasing or decreasing

The following graph shows the market for loanable funds in a closed economy. The upward-sloping orange line represents the supply of loanable funds, and the downward-sloping blue line represents the demand for loanable funds 6 Suppl 4 Demano 300 LOANABLE FUNDS (Billions of dollars) 100 200 400 500 600 5 0 saving is the source of the supply of loanable funds. As the interest rate falls, the quantity of loanable funds supplied increases Suppose the interest rate is 3.5%. Based on the previous graph, the quantity of loanable funds supplied is demanded, resulting in a than the quantity of loans of loanable funds. This would encourage lenders to the interest rates they charge, thereby the quantity of loanable funds supplied and the quantity of loanable funds demanded, moving the market toward the equilibrium interest rate of

Explanation / Answer

Saving ; decreases (direct relation between interest rate and supply of loanable funds)

1. greater

2. surplus

3. lower

4. decreasing

5. increasing

6. 3%

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