An increase in the supply of saving curve will cause the equilibrium quantity of saving to:
A) increase.
B) decrease.
C) remain unchanged.
D) first increase and then decrease.

Question

Quizplus · Accepted Answer

An increase in the supply of saving curve will cause a decrease in the interest rate. As the interest rate decreases, quantity of saving demanded by borrowers will increase, which will cause an increase in the equilibrium quantity of saving.

An Increase in the Supply of Saving Curve Will Cause