Match each of the following scenarios with the appropriate graph of the market for loanable funds.

a. An increase in the real interest rate results in only a small increase in private saving by households.
b. A decrease in the real interest rate results in a substantial increase in spending on investment projects by businesses.
c. The federal government eliminates 401(k) retirement accounts.
d. The federal government reduces the tax on corporate profits. (Assume no change in the federal budget deficit or budget surplus.)

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1. 2. S2 S1 Real Real interest interest rate rate Loanable funds Loanable funds 3. 4. Real interest Real S1 interest rate rate D2 Loanable funds Loanable funds