A decrease in the government budget deficit decreases the ________ loanable funds and an increase in the government budget surplus increases the ________ loanable funds.

Question

Quizplus · Accepted Answer

A decrease in the government budget deficit means the government is borrowing less, reducing the demand for loanable funds. An increase in the government budget surplus means the government has extra funds, which can be lent out, increasing the supply of loanable funds.

A Decrease in the Government Budget Deficit Decreases the ________