Suppose the government increases spending on public education by $700 million and individual spending on private education drops by $700 million. This is an example of
A) incomplete crowding out.
B) complete crowding out.
C) zero crowding out.
D) a and c
E) none of the above
B
You might also like to view...
"When a person is more productive in producing a good or service than another person, the first person has the comparative advantage in producing the good." Is this assertion correct or incorrect? Explain your answer
What will be an ideal response?
Suppose the government wants to increase the price of a specific agricultural product. Discuss the welfare effects of four possible policies: price floor, price support, production quota and voluntary production reduction. Which policy is least efficient? Discuss the differences in the benefits to farmers and the cost to the government.
What will be an ideal response?
Explain the CPI bias and how it can distort private contracts and increase government outlays
What will be an ideal response?
All of the following are true regarding managerial diseconomies except which one?
A) They cause an increase in a firm's total profit. B) They can increase as a firm adds more plants. C) They can increase as a firm expands its scope of operations. D) They affect a firm's total profit.