For example, in the technology boom of the late 1990s, many businesses became extremely confident that

investments in new technology would have a high rate of return, and their demand for financial capital shifted

to the right. Conversely, during the 2008 and 2009 Great Recession, their demand for financial capital at any

given interest rate shifted to the left.

To this point, we have been looking at saving in total. Now let us consider what affects saving in different types

of financial investments. In deciding between different forms of financial investments, suppliers of financial

capital will have to consider the rates of return and the risks involved. Rate of return is a positive attribute of

investments, but risk is a negative. If Investment A becomes more risky, or the return diminishes, then savers

will shift their funds to Investment B—and the supply curve of financial capital for Investment A will shift back
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