Which of the Following Is an Example of Crowding Out

question 125

Multiple Choice

Which of the following is an example of crowding out?

• A) A decrease in the rate of growth of the money supply which causes a decrease in Real GDP.
• B) A budget deficit causes an increase in interest rates,which causes a decrease in investment spending.
• C) An increase in tariffs which causes a decrease in imports.
• D) A decrease in government housing subsidies which causes an increase in private spending on housing.

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Definitions:

Extrapolation

The process of estimating, beyond the original observation range, the value of a variable on the basis of its relationship with another variable.

Predictive Analysis

The process of selecting, exploring, analyzing, and modeling data to create better business outcomes.

Business Outcomes

The results, achievement, or consequences that a company experiences as a direct or indirect effect of its strategy and actions.

Technological Changes

The advancements and innovations in technology that alter how tasks are performed, services are delivered, and products are created or improved.