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1.Consider the loanable funds market. Suppose the government's deficits increase. What is the effect on this market? The real interest rate increases and the quantity
1.Consider the loanable funds market. Suppose the government's deficits increase. What is the effect on this market?
The real interest rate increases and the quantity of loanable funds decreases
The real interest rate decreases and the quantity of loanable funds decreases
The real interest rate increases and the quantity of loanable funds increases
The real interest rate decreases and the quantity of loanable funds increase
None of the above
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