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Explain, using appropriate diagrams, how a rise in the household saving rate can cause a fall in GDP, and how a fiscal stimulus might offset this.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Explain, using appropriate diagrams, how a rise in the household saving rate can
cause a fall in GDP, and how a fiscal stimulus might offset this.

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