One Side Effect of Expansionary Fiscal Policy Is That

question 21

Multiple Choice

One side effect of expansionary fiscal policy is that

• A)higher interest rates cause a change in the composition of GDP
• B)higher interest rates significantly increase private saving
• C)consumption spending is crowded out
• D)the Fed has to reinforce the policy through open market sales
• E)all of the above

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Definitions:

Month-end Contributions

The act of adding funds to an investment, account, or plan specifically at the end of a month.

Bond Fund

A mutual fund that invests primarily in bonds and other debt securities to generate returns.

Ordinary Annuity

A series of equal payments made at regular intervals, with the interest compounding period matching the payment period, such as annually.

Expressed

Articulated or conveyed in words, symbols, or in another explicit manner.