The Crowding Out Effect

question 114

Multiple Choice

The crowding out effect:

• A)increases the multiplier effect, so that an increase in taxes reduces income by more.
• B)increases the multiplier effect, so that an increase in taxes reduces income by less.
• C)decreases the multiplier effect, so that an increase in taxes reduces income by more.
• D)decreases the multiplier effect, so that an increase in taxes reduces income by less.

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Definitions:

Functionalism

A sociological perspective that views society as a complex system whose parts work together to promote solidarity and stability, focusing on the functions that social institutions serve.

Conflict Theory

A perspective in sociology that views society as composed of groups that are competing for scarce resources.

Census Family

A unit defined for statistical purposes in a census, often including individuals related by blood, marriage, common-law, or adoption living in the same dwelling.

Economic Family

A group of individuals related by blood, marriage, or adoption who live together and are financially interdependent.