Figure 14-6
-Refer to Figure 14-6.The market is in equilibrium.If the government budget deficit rises,which of the following would you expect to see?
A) The quantity of loanable funds demanded by firms will rise above $120 million.
B) The quantity of loanable funds demanded by firms will fall below $120 million.
C) The budget deficit will have no impact on the quantity of loanable funds demanded by firms.
D) The interest rate will fall below 4 percent.
Correct Answer:
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