Reductions in Private Spending as a Result of Increased Government

question 161

Multiple Choice

Reductions in private spending as a result of increased government spending or the need to finance a budget deficit is called

• A) pushing in.
• B) rushing forth.
• C) crowding in.
• D) crowding out.

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Definitions:

Invested Assets

Assets that are allocated towards investments including securities, real estate, and other assets expected to produce income or profit.

Break-Even

Break-even point is the level of production or sales at which total revenues equal total expenses, resulting in no net loss or gain.

Fixed Costs

Fixed costs are expenses that do not change with the level of production or sales, such as rent and salaries.

Variable Costs

Costs that vary in total in direct proportion to changes in the level of activity or volume of output produced.