The Crowding-Out Effect Implies That Budget Deficits Will

question 110

Multiple Choice

The crowding-out effect implies that budget deficits will

• A)increase real interest rates and lower the future stock of private capital.
• B)decrease real interest rates and increase the future stock of private capital.
• C)increase the productivity of workers in the future.
• D)lead to higher levels of income for workers in the future.

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Definitions:

Decoder

A device or program that translates encoded data into its original format, or an individual who interprets complex information.

Receiver

In communication, the individual or entity that interprets and potentially responds to a message sent by a sender.

Instigator

A person who initiates or provokes a certain action or event.

Self-esteem

An individual's subjective evaluation of their own worth or value.