The Crowding-Out Effect Arises When

question 150

Multiple Choice

The crowding-out effect arises when

• A) government lends in the money market, thus decreasing interest rates.
• B) government borrows in the money market, thus decreasing interest rates.
• C) government lends in the money market, thus increasing interest rates.
• D) government borrows in the money market, thus causing an increase in interest rates.

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Definitions:

Guarded

Involving careful and cautious behavior or actions.

Addressing Ambivalence

The act of recognizing and dealing with mixed feelings or contradictory attitudes towards a decision or change.

Overt and Covert Messages

Direct and openly communicated messages (overt) versus hidden or subtly delivered messages (covert).

Cohesive

Characteristic of a group or material that sticks together well or is united in pursuit of common objectives.