Holding other factors constant, if a stable political system decreases the desire for precautionary saving, then the real interest rate will ____ and the equilibrium quantity of saving and investment will ____. Select one: a. increase; increase b. decrease; increase c. increase; decrease d. decrease; decrease
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A stable political system decreases the desire for precautionary saving. This means that individuals feel more secure about their future and are less inclined to save money for unexpected events or emergencies. Show more…
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