According to the Crowding-Out Effect,an Increase in Government Spending

question 221

Multiple Choice

According to the crowding-out effect,an increase in government spending

• A)increases the interest rate and so increases investment spending.
• B)increases the interest rate and so decreases investment spending.
• C)decreases the interest rate and so increases investment spending.
• D)decreases the interest rate and so decreases investment spending.

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Definitions:

Strict Liability

A legal principle that makes an individual or organization accountable for their actions or products, eliminating the requirement for the plaintiff to demonstrate negligence or fault.

Insider Trading

Illegal buying or selling of a corporation's stock or other securities by individuals with access to nonpublic, material information about the company.

Tipping

Giving money to someone for their service, more than what is due for the service itself.

Stock Purchase

The act of acquiring ownership shares in a company, representing a partial ownership stake.