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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

How would you expect larger budget deficits to affect private sector investment in physical capital? Why?

To determine

To state: The effect of large budget deficits on the physical capital investment for private sector along with the reasons.

Explanation

When there is a high increase in budget deficits, it implies that the fewer amount of financial capital will be available for the private firms for the investment in physical capital.Due to more deficits of income over expenditure, the investment of physical capital will fall...

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