How does government borrowing crowd out investment

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There are different types of financial intermediaries with different roles in the economy. Savings and investment spending are interdependent, and interest rates are determined in the loanable funds market.

What are the roles of financial intermediaries and loanable funds market in promoting long-run economic growth? How do financial intermediaries link saving and investment?

How does government borrowing crowd out investment? What is the relationship between government borrowing and budget deficits?

Reference no: EM131709473

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