The crowding-out effect implies that:
a. increases in government purchases will lower interest rates and stimulate investment spending
b. higher taxes reduce both consumption and saving.
c. fiscal policy effects on interest rates will be offset by monetary policy.
d. increases in government purchases increase income and the demand for loanable funds which will choke off some private spending.
d
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What does it mean for a firm to be a price taker in the labor market?
What will be an ideal response?
The term used to describe a more realistic conception of human problem-solving that assumes less than perfect analysis is: a. framing
b. compartmentalizing. c. countercyclical policy. d. bounded rationality.
Highway and home construction had a boom from
A. 1925-1940. B. 1935-1950. C. 1945-1960. D. 1965-1980.
Answer the following questions true (T) or false (F)
1. A normal good is a good for which the demand increases as income decreases, holding everything else constant. 2. The income effect explains why there is an inverse relationship between the price of a normal good and the quantity of the good demanded. 3. If consumers believe the price of iPads will decrease in the future, this will cause the demand for iPads to decrease now.