Forgiving Student Debt

November 25, 2019

Forgiving Student Debt Would Boost Economy, Economists Say

Questions

1. How much student debt does Elizabeth Warren propose forgiving? How much student debt does Bernie Sanders propose forgiving?
2. Explain how forgiving student debt would influence the government budget balance.
3. Everything else remaining the same, given your answer to #2, explain how forgiving student debt would influence the loanable funds market.
4. Why does forgiving student debt change consumption expenditure and investment?
5. Draw a graph to illustrate your answer to #3 and #4.