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Macroeconomics 11th Edition by Michael Parkin
Edition 11ISBN: 9780133423884Macroeconomics 11th Edition by Michael Parkin
Edition 11ISBN: 9780133423884 Exercise 19
Government in the Loanable Funds Market
Government in the Loanable Funds Market
Use the following information to work Problem.
India's Economy Hits the Wall
At the start of 2008, India had an annual growth of 9%, huge consumer demand, and increasing foreign investment. But by July 2008, India had 11.4% inflation, large government deficits, and rising interest rates. Economic growth is expected to fall to 7% by the end of 2008. A Goldman Sachs report suggests that India needs to lower the government's deficit, raise educational achievement, control inflation, and liberalize its financial markets.
If the Indian government reduces its deficit and returns to a balanced budget, how will the demand for or supply of loanable funds in India change?
Government in the Loanable Funds Market
Use the following information to work Problem.
India's Economy Hits the Wall
At the start of 2008, India had an annual growth of 9%, huge consumer demand, and increasing foreign investment. But by July 2008, India had 11.4% inflation, large government deficits, and rising interest rates. Economic growth is expected to fall to 7% by the end of 2008. A Goldman Sachs report suggests that India needs to lower the government's deficit, raise educational achievement, control inflation, and liberalize its financial markets.
If the Indian government reduces its deficit and returns to a balanced budget, how will the demand for or supply of loanable funds in India change?
Explanation
Verified
Verified
In this scenario if the Indian governmen...
Macroeconomics 11th Edition by Michael Parkin
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