Which one of the following might offset a crowding-out effect of financing a large public debt?
A)a decline in net exports
B)an increase in public investment
C)a decrease in the money supply
D)a decline in public investment

Question

Quizplus · Accepted Answer

An increase in public investment can offset the crowding-out effect by stimulating economic activity and potentially increasing productivity, which can lead to higher economic growth and offset the negative impacts of increased public debt.

Which One of the Following Might Offset a Crowding-Out Effect