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Use the following to answer questions: Use the following to answer questions:   -(Figure: Loanable Funds)  Use Figure: Loanable Funds. Which scenario might produce a new equilibrium interest rate of 4% and a new equilibrium quantity of loanable funds of $75 billion? A)  Profit expectations for business investments become less optimistic. B)  Capital inflows from foreign citizens decline. C)  The federal government runs a budget deficit, rather than a surplus. D)  The government eliminates taxes on income from interest earned.
-(Figure: Loanable Funds) Use Figure: Loanable Funds. Which scenario might produce a new equilibrium interest rate of 4% and a new equilibrium quantity of loanable funds of $75 billion?


A) Profit expectations for business investments become less optimistic.
B) Capital inflows from foreign citizens decline.
C) The federal government runs a budget deficit, rather than a surplus.
D) The government eliminates taxes on income from interest earned.

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