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How Government Transfers Affect Public Saving, Interest Rates, and Equilibrium Investment

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Other things the same, if the government increases transfer payments to households and the marginal propensity to consume is positive, then the effect of this on the governments budget Other things the same, if the government increases transfer payments to households and the marginal propensity to consume is positive, then the effect of this on the governments budget will make public saving rise. will make the equilibrium interest rate rise. will make investment of equilibrium rise. All the above are correct..

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Other things the same, if the government increases transfer payments to households and the marginal propensity to consume is positive, then the effect of this on the governments budget Other things the same, if the government increases transfer payments to households and the marginal propensity to consume is positive, then the effect of this on the governments budget will make public saving rise. will make the equilibrium interest rate rise. will make investment of equilibrium rise. All the above are correct.

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How Government Transfers Affect Public Saving, Interest Rates, and Equilibrium Investment

  • 1. Other things the same, if the government increases transfer payments to households and the marginal propensity to consume is positive, then the effect of this on the governments budget Other things the same, if the government increases transfer payments to households and the marginal propensity to consume is positive, then the effect of this on the governments budget will make public saving rise. will make the equilibrium interest rate rise. will make investment of equilibrium rise. All the above are correct.