The crowding-out effect is
A) the tendency of expansionary fiscal policy to cause an increase in planned investment but not in planned consumption in the U.S. private sector.
B) the tendency of contractionary fiscal policy to cause an increase in planned investment but a decrease in planned consumption in the U.S. private sector.
C) the tendency of expansionary fiscal policy to cause a decrease in planned investment or planned consumption in the U.S. private sector.
D) the tendency of contractionary fiscal policy to cause an increase in planned investment or planned consumption in the U.S. private sector.
C
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The rationality assumption states that
A) all actions taken by consumers are based on what is good for society. B) people make decisions regardless of how the outcome will affect them. C) people make decisions to buy only those goods that they need rather than goods that they want. D) people do not intentionally make decisions that would leave them worse off.
What are the differences and similarities between a depreciation and devaluation of a currency?
What will be an ideal response?