Question: Questions 1. One journalist writing about the complex interactions between I various markets in the economy stated: When the government spends more than it takes

Questions 1. One journalist writing about the complex interactions between I various markets in the economy stated: "When the government spends more than it takes in taxes it must sell bonds to finance its excess expenditures. But selling bonds drives interest rates down and thus stimulates the economy by encouraging more investment and decreasing the foreign exchange rate, which helps our export industries." Carefully analyze the statement. Do you agree? Why or why not? (20 points)

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