An increase in government spending that is not financed by an increase in taxes will cause which of the following?
A) an increase in interest rates and an increase in planned investment
B) an increase in interest rates and a reduction in planned investment
C) a reduction in interest rates and an increase in planned investment
D) a reduction in interest rates and a reduction in planned investment
B
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A bank has excess reserves of $4,000 and demand deposit liabilities of $100,000 when the required reserve ratio is 20 percent. If the reserve ratio is raised to 25 percent, the bank's excess reserves will be
A) -$5,000. B) -$1,000. C) $1,000. D) $5,000.
Innovations that generate profit for a firm's owners include developing
a. both c and d b. all of the following c. markets in new locations d. new products e. new production processes and distribution methods