Scenario 1: Individual Retirement Accounts (IRAS) allow people to shelter some of their income from taxation. Suppose the maximum annual contribution to such accounts is $5,000 per person. Now suppose there is an increase in the maximum contribution, from $5,000 to $8,000 per year. Market for Loanable Funds INTEREST RATE LOANABLE FUNDS This change causes savers to supply of loanable funds demanded, there is quantity of foanable funds demanded. loanable funds. Because the quantity of loanable funds supplied is now pressure on interest rates. This change in interest rates causes an) the quantity in the