7. Using the graph below, show what will happen to supply and demand in the market for loanable funds when the government budget deficit increases, changing the equilibrium quantity of loanable funds by 3 percentage points. a. Draw the shift on the graph below (or similar) (per the above instructions). b. Ceteris paribus, what is the new interest rate? c. Ceteris paribus, private investment would 10 Supply Interest rate (%) N Demand 0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 Quantity of loanable funds (% of GDP)