What Impact Does a Smaller Crowding-Out Effect Have on the Magnitude

question 111

Multiple Choice

What impact does a smaller crowding-out effect have on the magnitude of a given fiscal policy's effect on unemployment and net exports?

• A)It decreases the magnitude of a given fiscal policy's effect on unemployment in the long run and increases the magnitude of its effect on net exports.
• B)It increases the magnitude of a given fiscal policy's effect on unemployment in the long run and increases the magnitude of its effect on net exports.
• C)It does not affect the magnitude of a given fiscal policy's effect on unemployment in the long run or the magnitude of its effect on net exports.
• D)It increases the magnitude of a given fiscal policy's effect on unemployment in the long run and decreases the magnitude of its effect on net exports.