If the government’s budget becomes a deficit of $1 trillion and the Ricardo-Barro effect occurs, what are the real interest rate and investment? Use the table in Problem 7 and the following data to...

If the government’s budget becomes a deficit of

$1 trillion and the Ricardo-Barro effect occurs,

what are the real interest rate and investment?

Use the table in Problem 7 and the following data to

work Problems 10 and 11.

Suppose that the quantity of loanable funds demanded increases by $1 trillion at each real interest rate

and the quantity of loanable funds supplied increases

by $2 trillion at each interest rate.