Assume that a perfectly competitive financial market for loanable funds is in equilibrium. Which of the following is most likely to occur to the quantity demanded and quantity supplied of loanable funds if the government imposes an effective interest rate ceiling?
Quantity Demanded ...... Quantity Supplied
(a) Increase ...... increase
(b) Increase ...... decrease
(c) no change ...... no change
(d) decrease ...... increase
(e) decrease ...... decrease
