'Crowding Out' Will Be Smaller If

question 87

Multiple Choice

'Crowding out' will be smaller if:

• A)consumption spending is more sensitive to changes in the interest rate.
• B)equilibrium GDP is further below potential GDP.
• C)investment spending is less sensitive to changes in the interest rate.
• D)the economy is at or above full employment.

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Definitions:

Fertility

The natural capability to produce offspring, a measure of reproduction rate for an individual or population.

Parturition

The act or process of giving birth; childbirth.

Micturition

The act of urinating or voiding the bladder.

Gastrulation

An initial stage in the embryonic growth of many animals, where the blastula, which originally has a single layer, transforms into a gastrula, a structure with multiple layers.