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Crowding-Out Effect
The phenomenon where increased government spending leads to a reduction in private sector spending and investment, due to higher interest rates or other factors.
Private Investment
The expenditure on capital goods by private sector firms or individuals to increase their production capacity or asset portfolio.
Government Spending
The total amount of money spent by the government on various services and projects, including education, defense, infrastructure, and welfare programs.
Crowding-Out Effect
Describes a situation in economics where increased public sector spending reduces or eliminates private sector spending, often due to higher interest rates or borrowed funds.
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