Final answer:
The financial industry is moving towards incorporating psychology and sociology, reflecting the behavioral finance trend. Both a rise in supply and demand for financial capital in markets can lead to an increased quantity of loans made and received.
Step-by-step explanation:
The sentence, 'There has been a movement in recent times for the financial industry to be more in touch with psychology and sociology due to their effect and persuasiveness in financial matters.' is best completed by option 3, which is 'psychology and sociology'. This reflects the trend towards behavioral finance, where the impact of human behavior on financial markets is considered to be significant.
When considering changes in the financial market that lead to an increase in the quantity of loans made and received, both 'a rise in demand' and 'a rise in supply' of financial capital would contribute to this increase. As per economic principles, a rise in the supply of loans can reduce interest rates, making borrowing more attractive and thus increasing the quantity of loans received. Similarly, a rise in demand for loans could reflect increased consumer and business confidence, which also leads to more loans being made and received.