The crowding-out effect refers to the possibility that:
A. when used simultaneously, expansionary fiscal and monetary policies are
counterproductive.
B. the asset demand for money varies inversely with the interest rate.
C. deficit financing will increase the interest rate and reduce investment.
D. an increase in the supply of money will result in a decline in velocity.
C. deficit financing will increase the interest rate and reduce investment.
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A point on the per-worker production function shows:
a. the total output produced by the labor force of an industry on the vertical axis for each level of capital per worker on the horizontal axis. b. the marginal output per worker on the vertical axis for each level of worker per unit of capital on the horizontal axis. c. the marginal output per worker on the vertical axis for each level of capital per worker on the horizontal axis. d. the level of capital per worker on the vertical axis for respective average output per worker on the horizontal axis. e. the average output per worker on the vertical axis for each level of capital per worker on the horizontal axis.
Historical data shows that if consumption increases by $80 billion when national income rises from $100 billion to $200 billion, then consumption will increase by less than $80 billion when national income rises from $200 billion to $300 billion
Indicate whether the statement is true or false
The Island Republic is a small, tropical nation with rich agricultural land and a warm climate. Which products might it export at a lower opportunity cost than would a larger country in a cooler climate?
a. cars and trucks b. pineapples and flowers c. insurance and banking d. cotton and lumber
In which of the following cases must price always fall?
A. Demand increases and supply increases. B. Demand decreases and supply decreases. C. Supply increases and demand remains constant. D. Demand decreases and supply increases. E. Both c and d