The following graph shows the market for loanable funds in Aperto, a large open economy. The government of Aperto has just instituted a tax hike, decreasing the deficit. On the graph, shift either the demand curve or the supply curve to illustrate the change in fiscal policy. (? Domestic Saving Supply Demand Supply Demand 10 20 30 40 50 QUANTITY OF LOANABLE FUNDS . As an open economy, this change in interest rate causes the net capital , which in turn causes Aperto's net The decrease in deficit causes the interest rate in Aperto to inflow to Aperto to exports to . This change in net capital inflow causes Aperto's currency to . The change in net exports caused by the tax hike the impact on aggregate demand of the restrictive fiscal policy. REAL INTEREST RATE
The following graph shows the market for loanable funds in Aperto, a large open economy. The government of Aperto has just instituted a tax hike, decreasing the deficit. On the graph, shift either the demand curve or the supply curve to illustrate the change in fiscal policy. (? Domestic Saving Supply Demand Supply Demand 10 20 30 40 50 QUANTITY OF LOANABLE FUNDS . As an open economy, this change in interest rate causes the net capital , which in turn causes Aperto's net The decrease in deficit causes the interest rate in Aperto to inflow to Aperto to exports to . This change in net capital inflow causes Aperto's currency to . The change in net exports caused by the tax hike the impact on aggregate demand of the restrictive fiscal policy. REAL INTEREST RATE
Chapter17: Federal Deficits, Surpluses, And The National Debt
Section: Chapter Questions
Problem 7SQP
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