Question: Using the graphs below and the pre-defined curves for you to move into place, DO NOT INTERPRET THE FACT THAT THERE IS AN S2

Using the graphs below and the pre-defined curves for you to move into place, DO NOT INTERPRET THE FACT THAT THERE IS AN S2 and D2 TO MEAN YOU HAVE TO MOVE BOTH CURVES. Make sure that you also provide a typed response 1. The following was just announced just prior to the exam starting, "The Biden administration has finally decided to re-open drilling in the U.S. that will allow for an additional 20% of oil production to begin." In both graphical form and in words, explain what the Loanable Funds model would predict about the direction of interest rates. IR'S I $1 DN Qty of Loanable Funds S2 D2

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