Multiple Choice
According to the Ricardo-Barro effect, government deficits
A) lead to a rise in the equilibrium real interest rate, crowding out investment.
B) lead to simultaneous decreases in private saving and decreases in the equilibrium real interest rate and investment.
C) lead to simultaneous increases in private saving and no effect on the equilibrium real interest rate and investment.
D) lead to a fall in the equilibrium real interest rate and a rise in investment.
Correct Answer:
Verified
Correct Answer:
Verified
Q71: How does expected future income affect saving
Q117: Net investment equals<br>A) capital stock minus depreciation.<br>B)
Q118: <img src="https://d2lvgg3v3hfg70.cloudfront.net/TB6802/.jpg" alt=" -In the above
Q119: If the government's budget deficit increases and
Q120: A decrease in the demand for loanable
Q121: <span class="ql-formula" data-value="\begin{array}{|c|c|}\hline \text { Item }
Q123: According to the Ricardo-Barro effect,<br>A) a government
Q124: The nominal interest rate approximately equals which
Q126: In the loanable funds market, if the
Q127: A small country is a net foreign