Suppose a government tax cut increases disposable income.If there is no change in the government deficit or surplus, what effect would this tax cut have on the supply of loanable funds and the demand for loanable funds?
What will happen to the real interest rate?

Question

Suppose a government tax cut increases disposable income.If there is no change in the government deficit or surplus, what effect would this tax cut have on the supply of loanable funds and the demand for loanable funds?
 What will happen to the real interest rate?

Quizplus · Accepted Answer

The Answer of Suppose a government tax cut increases disposable income.If there is no change in the government deficit or surplus, what effect would this tax cut have on the supply of loanable funds and the demand for loanable funds?
 What will happen to the real interest rate?

Suppose a Government Tax Cut Increases Disposable Income