Suppose that the following graph depicts the market for funds in the US credit market. The blue line, labeled D, represents the demand for funds. The supply curve labeled s represents the supply curve of funds from American sources, with no foreign funds in the market. The supply curve labeled represents the supply curve of funds from both American and foreign sources D 10 - - - -- 1 Long-Term Interest Rate mount of Funds Without influence from foreign sources of funds, the long-term equilibrium interest rate is term equilibrium interest rate is % %. With influence from foreign funds, the long The following graph depicts the market for business investments in the United States. The green line represents the relationship between the long- term interest rate and the amount of business investments Use the black point (plus symbol) to plot the point that represents the combination of business investment and long-term interest rate that comes about when there is no influence from foreign funds. Then use the grey paint (star symbol) to plot the point that represents the combination business investment and long-term interest rate when the influence from Foreign funds is accounted for. 10 9 8 Without foreign funds With foreign funds Long-Term Interest Rate ON O 50 100 150 200 250 300 860 400 US Business Investment Billions 480 500