In this scenario, as the horseshoe magnet is moved toward the pile of iron shavings, the magnetic field of the magnet induces a magnetic attraction in the iron shavings. The shavings are drawn toward the ends of the magnet due to this magnetic force.
When the magnet approaches the iron shavings, the shavings experience a force that pulls them toward the magnet, and thus they gain kinetic energy as they move toward the magnet. The kinetic energy of the system increases because the shavings are moving in the direction of the magnetic force exerted by the magnet.
Therefore, the correct response is:
Kinetic energy increases because iron shavings move in the direction of magnetic force.