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1) If economic expansion is expected to decrease, the demand for loanable funds should ____ and interest rates should ____. increase; increase increase; decrease decrease;

1) If economic expansion is expected to decrease, the demand for loanable funds should ____ and interest rates should ____.

increase; increase

increase; decrease

decrease; increase

decrease; decrease

2) If the federal government reduces its budget deficit, this causes a(n) ____ in the supply of loanable funds and a(n) ____ in the demand for loanable funds.

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