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Students learn about the loanable funds market and the benefits to investment it typically becomes obvious that we

need to encourage more investment. According to our loanable funds market we have two options for doing this, increase the supply of savings or increase the demand for investments. The government can play a role in both of these policies, but we always have to ask whether the government should. Can you come up with a totally new and original program that would encourage more savings or a program that would encourage more investment.  

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A policy that asks to save a specified percentage of income can lead to a... View the full answer

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