Suppose the interest rate falls and the level of planned investment falls. In the loanable funds model which of the following could explain these changes? None of the other options can explain these changes. The government replaces a consumption tax with an income tax. The government goes from a budget surplus to a budget deficit. The government cancels an investment tax credit. This option is meit
Suppose the interest rate falls and the level of planned investment falls. In the loanable funds model which of the following could explain these changes? None of the other options can explain these changes. The government replaces a consumption tax with an income tax. The government goes from a budget surplus to a budget deficit. The government cancels an investment tax credit. This option is meit
Chapter1: Making Economics Decisions
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
Transcribed Image Text:Suppose the interest rate falls and the level of planned investment falls. In the loanable
funds model which of the following could explain these changes?
None of the other options can explain these changes.
The government replaces a consumption tax with an income tax.
The government goes from a budget surplus to a budget deficit.
The government cancels an investment tax credit.
This option is
correct
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