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Principles of Economics 2e

2nd Edition
Steven A. Greenlaw; David Shapiro
ISBN: 9781947172364

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BuyFindarrow_forward

Principles of Economics 2e

2nd Edition
Steven A. Greenlaw; David Shapiro
ISBN: 9781947172364
Textbook Problem

Explain how decreased domestic investments that occur due to a budget deficit will affect future economic growth.

To determine

The effect of decreased domestic investments on future economic growth needs to be determined.

Explanation

Due to the fall in the investment of capital, the economic growth falls. As the investment falls, the new equipments, materials and other stuffs of capital will not be available for the industries to grow.

In the case of budget deficit, the government mainly borrow from the loanable market...

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