Question: A government surplus can decrease investment through the crowding-out effect because the surplus decreases the quantity supplied of loanable funds. Is this statement correct? Explain

A government surplus can decrease investment through the crowding-out effect because the surplus decreases the quantity supplied of loanable funds." Is this statement correct? Explain with words

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Economics Questions!

Can you please help me with this practice question. Thank you "A government surplus can decrease investment through the crowding-out effect because the surplus decreases the quantity supplied of...

"A government surplus can decrease investment through the crowding-out effect because the surplus decreases the quantity supplied of loanable funds." Is this statement correct? Explain with words +...

Answer each question clearly and concisely. 1. Identify the following as consumption, investment, government purchases, or net exports. Justify your answers. a. Government of Canada repaves the...

The price of bonds and the interest rate are Question 1 options: a.not related. b. positively related. c. negatively related. d. sometimes positively related and other times negatively related,...

Economics 248 Assignment 1B This assignment has a maximum total of 100 marks and is worth 20 percent of your total grade for this course. You should complete it after completing your course work for...

This assignment has a maximum total of 100 marks and is worth 20 percent of your total grade for this course. You should complete it after completing your course work for Units 2 through 4. Answer...

Question 1 Use the graph to answer the question that follows. Real interest S rate D' q q Quantity of loanable funds If the graph above represents a change in the loanable funds market in the United...

1. Of the following statements, which explain why the crowding-out effect indicates government spending increases that are financed by the sale of Treasury bonds to the public will not necessarily...

Final_Exam_Macro Question 1 (2 points) Purchasing-power panty theory does not hold at all times because many goods are not easily transported and the same goods produced in different countries may be...

The current US Treasury bill rate is 0.19% per annum and the Australian Treasury bill rate is 3.1% per annum. The spot rate in Sydney is USD0.8299 per 1AUD i.e. AUD/USD 0.8299. The 3-month forward...

for the given circuit diagram identify the type of filter I and culculate the cut off frequency I.K. Vin 1.k ww R=lok C==4 C = 27 V REAS weg

If punishment occurs in private, few employees will know that unethical behavior was admonished; thus, managers should ensure that employees who behave unethically are punished publicly so that...

2. Imagine a real event that was problematic in your past. What images, sounds, emotions, smells and tastes appear? Try to imagine a movie clip of this inci-dent, as it could unfold if the...

5. How can I help others in the network achieve their goals?

6. Bring to mind a situation where you had a strong sense of satisfaction with what you did. Immerse yourself in the situation. i. How do you feel? ii. What do you hear? iii. What do you see?