Crowding-Out Occurs When

question 88

Multiple Choice

Crowding-out occurs when

• A) supply-side fiscal policy does not increase total output.
• B) consumption increases when government spending increases.
• C) private spending falls in response to increases in government spending.
• D) time lags crowd out the effects of fiscal policy.
• E) increases in government spending and decreases in taxes are offset by increases in savings.

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Definitions:

Retirement Fund

A pool of funds contributed to by individuals, employers, or both for the purpose of funding an employee's retirement.

Gross Pay

The gross income of an employee, which is the sum of all earnings before deductions or taxes are applied.

Deductions

Expenses or amounts subtracted from gross income to reduce the taxable income.

FICA-OASDI

Refers to the Social Security portion of the Federal Insurance Contributions Act tax, covering both the Old Age, Survivors, and Disability Insurance.