The Phenomenon of Crowding-Out Suggests That the Positive Impact of Budget

question 19

Multiple Choice

The phenomenon of crowding-out suggests that the positive impact of budget deficits on economic activity are reduced by ________.

• A)the impact produced by government spending on the environment
• B)an increase in national savings
• C)the interest rate effects associated with federal deficits
• D)the increase in pork barrel projects deficit spending entails

---

Definitions:

FUTA

The Federal Unemployment Tax Act (FUTA) is a United States federal law that imposes a payroll tax on employers to fund state workforce agencies.

Unemployment Taxes

Taxes paid by employers to fund the unemployment benefits, based on the number of employees and the history of layoffs.

Employer's Payment History

A record of all the payments made by an employer, including wages, taxes, and contributions.

Ceiling

The maximum limit on the price, wage, or other variable typically set by a government or regulatory body.