Which of the Following Best Describes the Crowding-Out Effect

question 32

Multiple Choice

Which of the following best describes the crowding-out effect?

• A) An increase in government expenditures will cause taxes to rise, which will reduce both aggregate demand and output.
• B) An increase in borrowing by the government will push interest rates upward, which will lead to a reduction in private spending.
• C) An increase in borrowing by the government will decrease the money supply and, thereby, reduce aggregate demand.
• D) An increase in government expenditures will cause the general level of prices to fall and, thereby, reduce aggregate demand and output.

Grasp the impact of cultural and social factors on mental health.

Recognize the limitations and criticisms of the DSM-5 classification scheme.

Understand the environmental and psychosocial triggers of mental illness.

Differentiate between organic and functional types of mental disorders.