Suppose that the Congress and President increase the maximum annual contributions limits to retirement accounts and at the same time reduce the budget deficit.What happens to the interest rate?

Question

Quizplus · Accepted Answer

Increasing contributions to retirement accounts increases savings, which can lead to a decrease in interest rates due to a higher supply of loanable funds. Reducing the budget deficit can also decrease interest rates by reducing government borrowing.

Suppose That the Congress and President Increase the Maximum Annual