Suppose the government of a hypothetical economy decides to pursue a restrictive fiscal policy by permanently decreasing government expenditures . The following graph shows the market for loanable funds in this hypothetical economy. Show the effect of the restrictive fiscal policy according to the new classical view by shifting the appropriate curve or curves on the following graph of the loanahle funds market If vouu decide that the nolicy produced no effect leave the granh unchanged

Suppose the government of a hypothetical economy decides to pursue a restrictive fiscal policy by permanently decreasing government expenditures . The following graph shows the market for loanable funds in this hypothetical economy. Show the effect of the restrictive fiscal policy according to the new classical view by shifting the appropriate curve or curves on the following graph of the loanahle funds market If vouu decide that the nolicy produced no effect leave the granh unchanged

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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