Crowding Out Occurs When

question 166

Multiple Choice

Crowding out occurs when

• A)investment declines because a budget deficit makes interest rates rise.
• B)investment declines because a budget deficit makes interest rates fall.
• C)investment increases because a budget surplus makes interest rates rise.
• D)investment increases because a budget surplus makes interest rates fall.

---

Definitions:

Accounts Payable

Liabilities or amounts owed by a company to its creditors for goods or services that have been delivered but not yet paid for.

Depreciation Expense

The portion of the cost of a fixed asset that is considered consumed during a specific accounting period, used to reflect wear and tear.

Accounts Receivable

Amounts due from customers to an enterprise for delivered but unpaid goods or services.

Fire Insurance

A type of property insurance that covers damage and losses caused by fire.