The Crowding-Out Effect Tends to Be Stronger When the Economy

question 109

Multiple Choice

The crowding-out effect tends to be stronger when the economy:

• A) Has a lot of excess productive capacity
• B) Is at, or close to, full employment
• C) Has a very small net exports or foreign sector
• D) Is a very open economy with a large foreign sector

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Definitions:

Accounting Period

A specific time period for which financial records and statements are prepared for a business or organization.

One Quarter

A term referring to one-fourth of a year, used in financial and business contexts to divide the fiscal or calendar year into four periods for reporting purposes.

One Year

A period consisting of 12 consecutive months.

Unearned Revenue

An accounting term referring to money received for a product or service yet to be delivered or performed.