The Crowding-Out Effect Refers to

question 117

Multiple Choice

The crowding-out effect refers to

• A) an increase in the consumption of domestic goods at the expense of imported goods.
• B) an increase in the consumption of imported goods at the expense of domestic goods.
• C) a decrease in consumption and investment caused by an increase in government borrowing.
• D) a decrease in consumer spending caused by a decrease in consumer confidence.