29 G20 Vows to Boost World GDP by $2 trillion The centrepiece of the 2014 G20 meeting is for all 20 countries to boost investment, create new jobs and together boost world income by $2 trillion over 5 years.

Source: Associated Press, 23 February 2014 a Explain the effect of an increase in planned investment on the demand for or supply of loanable funds.

b If G20 countries do increase global income, how will the world real interest rate, saving and investment change? Explain your answer.

c On a graph of the global loanable funds market, illustrate your answer to part (b).