The reduction in private borrowing that is caused by an increase in government borrowing is called:
A. surplus investment.
B. the savings effect.
C. the dissaving effect.
D. the crowding out effect.
Answer: D
You might also like to view...
Economists argue for free trade in export markets because
A) all consumers and producers benefit from exporting goods. B) the gains to the U.S. producers outweigh the losses to the U.S. consumers. C) the gains to the U.S. consumers outweigh the losses to the U.S. producers. D) no one is made worse off by exporting goods. E) exporting goods decreases total surplus.
What is the main difference in the classical model as compared to the short-run macro model?
a. In the classical model the economy automatically operates at potential GDP while in the short run model the economy can operate at a different level of GDP b. In the short run model the economy automatically operates at potential GDP while in the classical model the economy can operate at a different level of GDP c. Fiscal policy has no effect in the short run model but is very effective in the classical model d. There is no difference in the predictions of the two models e. The classical model does a better job in predicting recessions than the short-run macro model
Which of the following is NOT an automatic stabilizer?
A. Food stamps B. Unemployment insurance benefits C. Public assistance D. A supply-side tax cut
What is the price of a TV in an open economy without a quota?
A. $75 B. $125 C. $100 D. $150