When the government funds spending projects by borrowing money (issuing government bonds), demand in the loanable funds market will _______ and interest rates generally ______. A: Increase; rise. B: Decrease; fall. C: Decrease; rise. D: Increase; fall.

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Chapter8: Savings,investment And The Financial System
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When the government funds spending projects by borrowing money (issuing government bonds), demand in the loanable funds market will _______ and interest rates generally ______.

A: Increase; rise.

B: Decrease; fall.

C: Decrease; rise.

D: Increase; fall.

Please provide an explanation as well. Thank you!

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