Answer:
Option (d) is correct.
Step-by-step explanation:
When the supply of loanable funds increases and this change in loanable funds shifts the supply curve of loanable funds rightwards then as a result the equilibrium interest falls and the quantity of loanable funds increases.
In this situation, the supply of loanable funds exceeds the demand for loanable funds, so the financial institutions would provide funds at a lower interest rate to the borrowers.
Fall in the interest rate would induce borrowers to take loan at a cheaper rate.