Question 2 (20 points): Consider the market for borrowing money. In this market, the demand curve (D) for borrowing financial capital intersects the supply curve (S) for lending financial capital at equilibrium $.

a. At the equilibrium, the interest rate is 15% and the quantity of financial capital being loaned and borrowed is $600 billion. Draw a chart to visualize the interaction between SUPPLY and DEMAND with the EQUILIBRIUM point.

b. How may the equilibrium interest rate change if the central bank increases the money supply?