Multiple Choice
Refer to the table below to answer the following question.
Table 7.3.2
-Table 7.3.2 shows an economy's demand for loanable funds and supply of loanable funds schedules when the government's budget is balanced.The quantity of loanable funds demanded increases by $1 trillion at each real interest rate and the quantity of loanable funds supplied increases by $2 trillion at each real interest rate.If the government wants investment to be $9 trillion, it must _______ its budget balance by _______ trillion.
A) increase; $1
B) increase; $1.5
C) decrease; $1
D) increase; $2
E) decrease; $1.5
Correct Answer:

Verified
Correct Answer:
Verified
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