Use a diagram of the loanable funds market to illustrate the effect of the following events on the equilibrium interest rate and investment spending.

1. An economy is opened to international movements of capital, and a net capital inflow occurs.
2. Retired people generally save less than working people at any interest rate. The proportion of retired people in the population goes up.
3. The government reduces the size of its deficit to zero.
4. Consumers decide to save more. Assume the budget balance is zero.
5. Businesses become very optimistic about the future profitability of investment spending. Assume the budget balance is zero.