Figure 23.2.5 -Refer to Figure 23.2.5. in Figure 23.2.5, the Supply of 23.2.5

Multiple Choice

Figure 23.2.5

-Refer to Figure 23.2.5. In Figure 23.2.5, the supply of loanable funds curve is SLF₀ and the demand for loanable funds curve is DLF0. An expansion that increases disposable income and expected profit

A) shifts the supply of loanable funds curve rightward to curve SLF₁ and does not shift the demand for loanable funds curve.
B) shifts the supply of loanable funds curve rightward to curve SLF₁, and shifts the demand for loanable funds curve rightward to curve DLF₁.
C) shifts the demand for loanable funds curve rightward to curve DLF₁ and does not shift the supply of loanable funds curve.
D) has no effect on either the demand for loanable funds curve or the supply of loanable funds curve.
E) increases the inflation rate.