In the graph you've just made, what is the level of private saving when the government has a $1 trillion budget deficit? A. $2.5 trillion B. $2.0 trillion C. $1.5 trillion Thanks! Screenshot attached

ENGR.ECONOMIC ANALYSIS
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Author:NEWNAN
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In the graph you've just made, what is the level of private saving when the government has a $1 trillion budget deficit? A. $2.5 trillion B. $2.0 trillion C. $1.5 trillion

Thanks!

Screenshot attached

<
The real interest rate rises
and the equilibrium quantity
of loanable funds increases.
Private saving increases,
but investment decreases.
Reset
Real interest rate (percent per year)
12
Government deficit
increases demand
10
00
6
2
Real interest
rate rises
Investment
decreases
1.0
1.5
PDLF
Private saving
increases
SLF
DLF
2.0
2.5
3.0
3.5
Loanable funds (trillions of 2012 dollars)
Transcribed Image Text:< The real interest rate rises and the equilibrium quantity of loanable funds increases. Private saving increases, but investment decreases. Reset Real interest rate (percent per year) 12 Government deficit increases demand 10 00 6 2 Real interest rate rises Investment decreases 1.0 1.5 PDLF Private saving increases SLF DLF 2.0 2.5 3.0 3.5 Loanable funds (trillions of 2012 dollars)
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