This is a circuit exercise from Razavi's book. He used to point to the direction of current leaving the source in his circuit for N type of MOSFETS. But here, I think the drawn arrow refers to the current leaving the drain. Now I am confused, why he made it like this? Is this even NMOS or PMOS?! Which method should I use to distinguish between source and drain?
Think about how a an NMOS is build up:
Note how drain and source are identical structures. The device is completely symmetrical, you can use the drain as the source and the other way round. It makes no difference.
Some people like the arrow to show the direction of current flow but that is not needed as the NMOS is symmetrical.
The arrow in the symbol refers to PN junction between source and bulk. LIke in a diode it points to the N-type silicon, which is the source in this case making it an NMOS.
If swapping drain and source makes more sense to you (and here it could because then Vgs becomes zero) then you can do so and that would not change anything to the behaviour of the circuit.