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

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 real interest rate rises?

A) The supply of loanable funds curve would shift leftward to a curve such as SLF₁.
B) Nothing; the economy would remain at point a.
C) The supply of loanable funds curve would shift rightward to a curve such as SLF₂.
D) There would be a movement to a point such as b on supply of loanable funds curve SLF₀.