Crowding out refers to the situation in which:
a. foreigners sell their bonds and purchase U.S. goods and services.
b. borrowing by the federal government raises interest rates and causes firms to invest less.
c. increased federal taxes to balance the budget causes interest rates to increase and consumer credit decreases.
d. borrowing by the federal government causes state and local governments to lower their taxes.
b
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The opportunity cost of money is:
A. the price level. B. the time spent going to the bank to withdraw funds. C. the nominal interest rate. D. the fees charged by banks to provide checking services.
Explain which of the following count as money. a) a check in Ann's checkbook b) currency in Ann's bank c) currency in Ann's purse d) Ann's checking deposit
What will be an ideal response?
The lifetime income distribution of income is a ________ accurate indicator of the degree of economic inequality than the distribution of ________
A) less; of annual income B) more; of annual income C) less; of wealth D) less; annual Lorenz curves
According to Adam Smith, the "invisible hand" refers to which of the following?
a. The "best interests of society (public interest) will occur as an outcome of the market process coordinating the self-interested interactions of buyers and sellers (private interest). b. Government interference is the invisible hand of inefficiency. c. Bribes and graft is the invisible hand of inefficiency. d. The "best interests of society" will occur as an outcome of careful guidance by government authorities in allocating scarce goods and services.