If there is no Ricardo-Barro effect, the government
A) only affects the demand for loanable funds curve in the loanable funds market.
B) has no effect because private saving changes to offset the effect that the government's budget deficit or surplus might otherwise have.
C) 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.
D) increases the supply of loanable funds if it has a budget surplus and shifts the supply of loanable funds curve.
E) always has negative saving and therefore lowers the real interest rate.
D
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Both signaling and screening:
A. reduce efficiency in the market. B. are effective ways to increase information available to both parties. C. benefit the sellers but harm the buyers. D. benefit the buyers but harm the sellers.
When households and businesses interact in product markets money
a. is not exchanged b. is flowing toward businesses c. is flowing toward households d. is not used at all e. is flowing to both businesses and households
In the short-run macro model, what type of unemployment is caused by insufficient spending?
a. Cyclical b. Structural c. Frictional d. Seasonal e. All types of unemployment are caused by insufficient spending
The principle of comparative advantage holds that nations should
a. specialize in activities for which they have the lowest opportunity cost. b. strive to become self-sufficient in production. c. produce only goods and services for which they have absolute advantage. d. become less labor-intensive and more capital-intensive.