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The Graph Shows Saving Supply and Investment Demand Curves

Question 46

Multiple Choice

The graph shows saving supply and investment demand curves. In panel A, saving represents the supply of loanable funds. In Panel B, investment represents the demand for loanable funds. What is true about these curves? The graph shows saving supply and investment demand curves. In panel A, saving represents the supply of loanable funds. In Panel B, investment represents the demand for loanable funds. What is true about these curves?   A)  An increase in interest rates increases the quantity of saving supplied. B)  The quantity of saving is negatively related to the interest rate. C)  A decrease in interest rates decreases the quantity of investment demanded. D)  The quantity of investment is positively related to the interest rate.


A) An increase in interest rates increases the quantity of saving supplied.
B) The quantity of saving is negatively related to the interest rate.
C) A decrease in interest rates decreases the quantity of investment demanded.
D) The quantity of investment is positively related to the interest rate.

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