Suppose that the government has a budget deficit of $1 trillion and the Ricardo-Barro effect occurs, what
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The table shows an economys demand for loanable funds and the supply of loanable funds schedules, when the governments budget is balanced.
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Real interest rate percent per year Loanable funds demanded Loanable funds supplied (trillions of 2005 dollars) 8.5 8.0 7.5 7.0 6.5 6.0 5.5 5.5 6.0 6.5 6 7.5 8.0 8.5 10
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The equilibrium real interest rate remains 7 per...View the full answer
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Related Book For
Macroeconomics Canada in the Global Environment
ISBN: 978-0321778109
8th edition
Authors: Michael Parkin, Robin Bade
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