If people (who used to neither borrow nor save)are now saving for their retirement then this will cause the
A)supply for loanable funds to increase.
B)demand for loanable funds to increase.
C)supply for loanable funds to decrease.
D)demand for loanable funds to decrease.

Question

Quizplus · Accepted Answer

When people start saving more, especially for something like retirement, they are essentially putting more money into financial institutions or investment vehicles. This increase in savings increases the pool of funds available for lending, hence increasing the supply of loanable funds.

If People (Who Used to Neither Borrow nor Save)are Now