Assume the Canadian government was to decide to increase the budget field.Holding all else constant, this will cause ______ to increase.

Question

Quizplus · Accepted Answer

An increase in the budget field typically means the government is spending more. To finance this additional spending, the government may need to borrow more, which can lead to higher interest rates as the demand for loanable funds increases. Therefore, both interest rates and government borrowing are likely to increase.

Assume the Canadian Government Was to Decide to Increase the Budget