The following figure shows two credit demand curves, CD₁ and CD₂, and two credit supply curves, CS₁ and CS₂.
-Refer to the figure above.Which of the following statements is true when the credit demand curve is CD₂ and the credit supply curve is CS₁?
A) At all rates of interest below 5 percent, there will be an excess demand for credit.
B) At all rates of interest below 6 percent, there will be an excess demand for credit.
C) At all rates of interest below 7 percent, there will be an excess demand for credit.
D) At all rates of interest below 8 percent, there will be an excess demand for credit.
Correct Answer:
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