The supply curve for land is perfectly elastic

In the above figure, the economy is at point a on the initial supply of loanable funds curve SLF0. What happens if real wealth decreases?

A) Nothing; the economy would remain at point a. B) There would be a movement to a point such as b on supply of loanable funds curve SLF0. C) The supply of loanable funds curve would shift rightward to a curve such as SLF2. D) The supply of loanable funds curve would shift leftward to a curve such as SLF1.

An increase in a small open economy's government budget deficit that reduces national saving and the current account balance causes an

A) increase in desired saving. B) increase in the world real interest rate. C) increase in exports. D) increase in absorption.