Which of tCredit rationing refers to a. the increase in the interest rate that occurs when the demand for credit increases. b. the increase in the interest rate that occurs when the supply of credit increases. c. the increase in the interest rate that occurs when the supply of credit decreases. d. a restriction in the availability of credit.he following is an example of adverse selection? a. A homeowner with a large fire insurance policy allows the wiring in her house to deteriorate. b. A woman with a large life insurance policy takes up sky diving. c. Your brother-in-law borrows $20,000 from you to open a pizza parlor, but spends it gambling at the racetrack instead. d. A man with a bad heart condition buys a large life insurance policy