Using the loanable funds theory, show in a graph how each
of the following events affects the supply and demand for loans and
the
equilibrium real interest rate:
a). A war leads the government to increase spending on the
military.
(Assume taxes do not change.). Please note, to get full points, you
need to
illustrate (on the proper, well-labeled graph) and explain.
b). Wars in other countries lead to higher government spending
in
those countries. Please note, to get full...