If there is no Ricardo-Barro effect, the govermment O A. plays no direct role in the loanable funds market because it doesn't affect either the demand for loanable funds or the supply of loanable funds. B. only affects the demand for loanable funds curve in the loanable funds market. OC. has no effect because private saving changes to offset the effect that the government's budget deficit or surplus might otherwise have. O D. increases the supply of loanable funds if it has a budget surplus and shifts the supply of loanable funds curve. O E. always has negative saving and therefore lowers the real interest rate.

If there is no Ricardo-Barro effect, the govermment O A. plays no direct role in the loanable funds market because it doesn't affect either the demand for loanable funds or the supply of loanable funds. B. only affects the demand for loanable funds curve in the loanable funds market. OC. has no effect because private saving changes to offset the effect that the government's budget deficit or surplus might otherwise have. O D. increases the supply of loanable funds if it has a budget surplus and shifts the supply of loanable funds curve. O E. always has negative saving and therefore lowers the real interest rate.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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