If Private Sector Investment Does Not Respond Much to Interest

question 155

Multiple Choice

If private sector investment does not respond much to interest rate changes, then

• A) there will be more crowding out when expansionary policies are undertaken.
• B) there will be less crowding out when expansionary policies are undertaken.
• C) fiscal policy will be less effective than monetary policy.
• D) monetary policy will be more effective than fiscal policy.

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Definitions:

Type A Behavior

A pattern characterized by high levels of competitiveness, self-imposed stress, aggression, and a sense of urgency.

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Behavioral Techniques

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