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Draw a correctly labeled loanable funds graph that shows what happens to real interest rates for each of the following situations:
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Question

#1. Draw a correctly labeled loanable funds graph that shows what

happens to real interest rates for each of the following situations: (You will have 3 graphs)

-The government borrows money to fund a war.
-Business investors become more optimistic about the economy.
-The government raises personal income taxes (do not consider the change in consumer saving).

Step-by-step answer

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