The effect of government borrowing can be modeled using the loanable funds market. A government budget...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
The effect of government borrowing can be modeled using the loanable funds market. A government budget deficit results in an increase in the demand (D) for loanable funds. A budget surplus reduces the demand for loanable funds. It results in an increase in the supply (S) of loanable funds if government pays off the debt Complete the table below. For the Effect on Government Budget specify Deficit or Surplus. Also, specify with up or down arrows what will happen to the tools of fiscal policy, the demand and supply of loanable funds, the debt, and the real interest rate Fiscal Policy Expansionary Contrationary Crowding Out Tools of Fiscal Policy G T G T Effect on Gov Budget Effect on Gov Debt Effect on Loanable Funds Market D D S S Effect on Real Interest Rate The effect of government borrowing can be modeled using the loanable funds market. A government budget deficit results in an increase in the demand (D) for loanable funds. A budget surplus reduces the demand for loanable funds. It results in an increase in the supply (S) of loanable funds if government pays off the debt Complete the table below. For the Effect on Government Budget specify Deficit or Surplus. Also, specify with up or down arrows what will happen to the tools of fiscal policy, the demand and supply of loanable funds, the debt, and the real interest rate Fiscal Policy Expansionary Contrationary Crowding Out Tools of Fiscal Policy G T G T Effect on Gov Budget Effect on Gov Debt Effect on Loanable Funds Market D D S S Effect on Real Interest Rate The effect of government borrowing can be modeled using the loanable funds market. A government budget deficit results in an increase in the demand (D) for loanable funds. A budget surplus reduces the demand for loanable funds. It results in an increase in the supply (S) of loanable funds if government pays off the debt Complete the table below. For the Effect on Government Budget specify Deficit or Surplus. Also, specify with up or down arrows what will happen to the tools of fiscal policy, the demand and supply of loanable funds, the debt, and the real interest rate Fiscal Policy Expansionary Contrationary Crowding Out Tools of Fiscal Policy G T G T Effect on Gov Budget Effect on Gov Debt Effect on Loanable Funds Market D D S S Effect on Real Interest Rate
Expert Answer:
Answer rating: 100% (QA)
Sure the image you sent appears to be consistent with how a sudden fall in income of consumers or ho... View the full answer
Related Book For
Microeconomics An Intuitive Approach with Calculus
ISBN: 978-0538453257
1st edition
Authors: Thomas Nechyba
Posted Date:
Students also viewed these economics questions
-
A cash flow is payable continuously at a rate of p, per annum at time t provided a life who is aged x at time 0 is still alive. I is a random variable T which measures the complete future lifetime in...
-
Wallace and Brace CPA assign a partner to screen and recommend (or decline) potential clients prior to acceptance. Discuss at least 4 specific issues which should have been considered prior to...
-
Draw a plausible mechanism for each of the following transformations: (a) (b) [TSOH] MENH2 -H20
-
The Learning Center runs a day camp for 6-10 year olds during the summer. Its manager, Elizabeth Reed, is trying to reduce the center's operating costs to avoid having to raise the tuition fee....
-
The diagram shows part of a membrane containing a channel protein. Part of the protein molecule is shaded. a. Identify the parts labelled A, B and C. b. For each of the following, state whether the...
-
Christopher Boling was seriously injured in 2008 when vapors escaping from a gas can ignited. He filed a products liability claim against the manufacturer. To fund the litigation, Boling entered into...
-
A bank has $650,000 in assets to allocate among investments in bonds, home mortgages, car loans, and personal loans. Bonds are expected to produce a return of 10%, mortgages 8.5%, car loans 9.5%, and...
-
Please convert this E-R diagram to Relational model. Production Fixed Expenses FixedExpenseID DatePaid Description Amount Category Item Show/Production ShowID Actors Budget SetBudget OpiningDate...
-
Three entrepreneurs were looking to start a new brewpub near Sacramento, California, called Roseville Brewing Company (RBC). Brewpubs provide two products to customersfood from the restaurant segment...
-
Define the concept of "ICT4D and Indigenous People" by drawing from McMahon, Hudson and Fabian's article. Then, use this concept to explain the Canadian context, in which indigenous media...
-
Briefly discuss how computing operating leverage could help Cecelia evaluate the risk stemming from cost structure. You might wish to make a table with three columns: Sales levels and profits under...
-
Explain the two fundamental problems related to investing the Social Security trust fund in the stock market.
-
(a) Discuss the following aspects related to sedimentation: (i) Explain the difference between surface overflow rate and hydraulic residence time and the role of each in settling behaviour. (6) (ii)...
-
Describe the challenges faced by African-Americans in the aftermath of World War I
-
Discuss reasons for deteriorating loan portfolio quality. Explain in detail.
-
What is the designation for the runs in a 2k design using + and - notation? Sparsity of Effects Principle O Confounding Geometric Coding REML Question 24 (4 points) What postulates that most system...
-
A spacecraft has left the earth and is moving toward Mars. An observer on the earth finds that, relative to measurements made when the spacecraft was at rest, its a. length is shorter b. KE is less...
-
Suppose that you, after studying economics in college, quickly became rich so rich that you have nothing better to do than worry about your 16-year old niece who cant seemto focus on her future. Your...
-
In this exercise, we will explore some logical relationships between families of tastes that satisfy different assumptions. A: Suppose we define a strong and a weak version of convexity as follows:...
-
Most developed countries prohibit employers from paying wages below some minimum level w. This is an example of a price floor in the labor market and the policy has an impact in a labor market so...
-
Why is a lease of personal property commonly treated as a security interest?
-
Why might a creditor choose not to take security for a debt?
-
In what way do security devices act as an incentive to repay ones debts?
Study smarter with the SolutionInn App