If the Fed decreases the money supply at the same time the federal government decreases government spending, the crowding-out effect
A) will not be affected.
B) will be increased.
C) will be reduced.
D) could either increase or decrease depending on the sensitivity of planned investment to the interest rate.
Answer: C) will be reduced.
You might also like to view...
U.S. cotton production
a. remained concentrated in Georgia and South Carolina until after 1860. b. was unable to compete with wool production in the antebellum textile industry. c. accounted for more than half of the dollar value of US exports between 1800 and 1850. d. faced declining world demand for most of the antebellum period.
If you must determine the long-run equilibrium output of a perfectly competitive firm and you are permitted to see only one curve, which of the following curves is most helpful?
A. Demand B. Marginal cost C. Average cost D. Average fixed cost
If the price of a good is $0, a consumer will
a. consume an infinite quantity. b. consume all units with positive marginal utility. c. consume the entire amount supplied. d. consume until total utility becomes 0.
Jackie, a Canadian citizen, works only in the United States. The value of the output she produces is
a. included in both U.S. GDP and U.S. GNP. b. included in U.S. GDP, but it is not included in U.S. GNP. c. included in U.S. GNP, but it is not included in U.S. GDP. d. included in neither U.S. GDP nor U.S. GNP.