When incomes are larger than expenses, there is a budget surplus than can be saved. This surplus of funds can be used in the financial markets because liquidity has value.$$ You can lend that liquidity to someone who wants it more than you do at the moment and is willing to pay for it$.$ The price than you can get for your money has to do with:

Question $3$ options:

the time that you will allow your funds to be loaned...the longer time you$$ loan them, the more return you want.

supply and demand of excess funds.

the risk involved in loaning your money.$$ The more the risk, the more return you want.

opportunity costs because all decisions have opportunity costs.

all of the above