Suppose the government ran a budget surplus in 2010 and a larger surplus in 2011 . The loanable funds model would predict that, as a result of the increase in the surplus,
a. both the government debt and interest rates increased between 2010 and 2011.
b. both the government debt and interest rates decreased between 2010 and 2011.
c. the government debt increased and interest rates decreased between 2010 and 2011.
d. the government debt decreased and interest rates increased between 2010 and 2011.
b
You might also like to view...
An additional worker will add to the profit of a business, and therefore be more likely to be hired, if the
A. marginal cost of labor is greater than the marginal revenue. B. marginal revenue is less than the price of the output of the business. C. average cost of labor is positive. D. wage is less than the marginal revenue.
The impact of a decrease in expected inflation in the bond market will have a relatively large effect on the prices of bonds prices because the bond demand curve:
A. will shift right as will the bond supply curve. B. will shift left as the bond supply curve shifts right. C. and supply curves will shift left. D. will shift right but the bond supply curve shifts left.
Scarcity affects
A) only rich people. B) only poor people. C) only middle income people. D) all people.
The contention that specific sensitive domestic technologies must not be traded freely is
A. to protect domestic jobs. B. a national defense concern. C. the infant industry argument. D. dumping.