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For the following situation, explain with words and what would happen to the equilibrium interest rate, the amount of private investment in the economy, and the long run growth rate. Hint - using a savings-investment diagram (also known as the supply and demand of loanable funds diagram) will help you to answer this question. The government, having misjudged the level of output, pursues a policy of fiscal expansion by decreasing the level of government purchases. The interest rate will Choose... The long run growth rate of potential output will Choose ... The national savings curve will Choose... The amount of private investment will Choose... increase The investment demand curve will decrease remain unchanged shift to the right shift to the left