nave8875 nave8875

16-12-2022
Social Studies

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Now, suppose the government is experiencing a budget deficit. This means that _, which leads to __ loanable funds.

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kumargaurav1012000 kumargaurav1012000

20-12-2022

Now imagine that there is a budget deficit in the government. This implies a decline in national saving, which affects loanable money.

Investment spending makes up a large portion of real GDP. Investment spending on tangible assets contributes significantly to economic growth and is often the most volatile component of real GDP. So where does a company acquire the money to create a new facility if it wants to? Typically, businesses borrow that cash. The borrowing process is described by the market for loanable funds. Savings are the source of the loanable funds available. The demand for loanable cash is based on borrowing. The interaction between the availability of savings and the demand for loans determines the real interest rate and the total amount of loans made.

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