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Question 1 a. How can a federal budget deficit increase market equilibrium interest rates and...

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Question 1 a. How can a federal budget deficit increase market equilibrium interest rates and reduce private investment and future economic growth? (7 marks) b. If the national debt increases, is it true that we need not worry about the debt as long as the country is able to make payments on the debt? State why or why not. Explain your answer clearly. (7 marks) d. Explain 2 alternative methods that you can think of to raise government finance other than borrowing or incurring a budget deficit. (6 marks)

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