Which of the Following Is Not an Example of Crowding

question 11

Multiple Choice

Which of the following is not an example of crowding out?

• A) Government purchases rise,the budget deficit rises,the federal government's demand for loanable funds rises,the interest rate rises,and investment falls.
• B) Government spends more on X,prompting individuals to spend less on X.
• C) Taxes decline,the budget deficit rises,the federal government's demand for loanable funds rises,the interest rate rises,the demand rises for U.S.dollars,the dollar appreciates,and net exports decline.
• D) Business firms spend more on X,prompting households to spend less on Y.
• E) none of the above

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