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Market in equilibrium point by interest rate

When this market is primarily in equilibrium at point c, any drop within interest rates caused through an increase in people’s willingness to save will cause as: (1) the rate of return schedule reflected into I0 to shift to the right. (2) the rate of return schedule reflected into I0 to shift to the left. (3) a movement down the rate of return schedule by point c to point e. (4) a movement up the rate of return schedule from point c to point a. (5) households to raise their saving.

1987_Problem on Loanable Funds.png

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