Interest rates on short-term U. S. Treasury bills turned negative on March 25, 2020. They inched back up into positive values shortly after, but they remained very low. In the case of negative interest rates, cash deposited at a bank yields a storage charge rather than an opportunity to earn interest income. If the central bank charges banks to store their reserves at the central bank, they are providing an incentive for banks to

Determine if the following statements are true or false. an increase in government spending can crowd out private investment. an improvement in the budget balance increases the demand for financial capital. an increase in private consumption may crowd out private investment. lower interest rates can lead to private investment being crowded out. a trade balance in sur+ increases the supply of financial capital. if private savings is equal to private investment, then there is neither a budget sur+ nor a budget deficit.