The Crowding-Out Effect Refers to the Tendency of

question 42

Multiple Choice

The crowding-out effect refers to the tendency of

• A) the additional borrowing accompanying larger budget deficits to increase interest rates and reduce private spending.
• B) higher future taxes accompanying budget deficits to reduce private consumption.
• C) the inflation rate to rise when the unemployment rate is low.
• D) increases in private savings to reduce interest rates and, thereby, crowd-out government expenditures.

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Definitions:

Treatment

The management and care of a patient for the purpose of combating a disease or disorder.

Cognitive Factors

Mental processes like perception, memory, and problem-solving that influence behavior and emotional states.

Maintain Insomnia

A condition where an individual has difficulty maintaining sleep, often waking up during the night and having trouble returning to sleep.

Stimulus Control

The modification of behavior through the use of stimuli to elicit or reinforce specific responses.