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5 votes
How would you explain the debt problem facing the new government?

1 Answer

5 votes

Answer:

Higher government debt increases the demand for available funds and raises interest rates

Step-by-step explanation:

Higher government debt increases the demand for available funds and raises interest rates. Fewer available funds and higher rates make it more difficult for businesses and individuals to secure funds to invest in housing, education, factories, equipment and training. Productivity and living standards suffer.

User Chris Neitzer
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