Use a diagram like Figure 26.9 to show the effects of each of the following on the

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Use a diagram like Figure 26.9 to show the effects of each of the following on the real interest rate and capital investment of a country that is a net borrower from abroad. (L05)
a. Investment opportunities in the country improve owing to new technologies.
b. The government budget deficit rises.
c. Domestic citizens decide to save more.
d. Foreign investors believe that the riskiness of lending to the country has increased.
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Principles of Economics

ISBN: 978-0073511405

5th edition

Authors: Robert Frank, Ben Bernanke

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