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Showing equilibrium in the market for loanable funds

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Reference no: EM131888641

a. Draw and label a graph showing equilibrium in the market for loanable funds.

b. Explain (using the graph) how an expansionary fiscal policy (an increase in government expenditure) affects the equilibrium.

c. Explain very briefly the effectiveness of fiscal policy in this context.

Reference no: EM131888641

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