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Use the graph to answer the question that follows. The graph has Quantity of loanable funds in dollars along the horizontal axis and Real interest
Use the graph to answer the question that follows. The graph has Quantity of loanable funds in dollars along the horizontal axis and Real interest rate in percent along the vertical axis. An upward-sloping line is labeled S l f. A downward-sloping line is labeled D l f. A second downward-sloping line, labeled D prime l f, is above or to the right of D l f. The intersection of S l f and D l f is labeled o. Point o meets the horizontal axis at value q and the vertical axis at value r. The intersection of S l f and D prime l f is labeled o prime. Point o prime meets the horizontal axis at value q prime and the vertical axis at value r prime. The graph shows a change in an economy after the government's decision to provide tax benefits to businesses in an effort to increase investment. What is the new point of equilibrium in the economy's loanable funds market? o o' r r qWhat is the effect of supply-side fiscal policies like decreasing taxes on investment, aggregate demand, and aggregate supply? The investment level in the economy decreases; aggregate demand increases; and
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