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Suppose there is an increase in budget deficit, what happens to intrest rates and national savings ?
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- What is a fiscal policy tool used to stimulate economic growth during a recession? A. Increasing government spending B. Reducing taxes C. Selling government bonds D. Reducing government spendingUsing a graph representing the market for loanable funds, show and explain what happens tointerest rates and investment if a government goes from a deficit to a surplus.The savings rate in a country is 25%. The government wants to expand GDP by $300 Billion. How much must they increase Government spending to reach that goal?