When crowding out occurs, higher government spending results in higher interest rates, which in turn results in:

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When government spending increases, interest rates rise because the government is borrowing more money to finance its spending. This increase in interest rates then makes it more expensive for individuals and businesses to borrow money, leading to less consumption and investment. This phenomenon is known as crowding out. Therefore, higher government spending results in less consumption and investment, rather than higher inflation (A), a larger debt ceiling (C), or more tax revenues (D).

When Crowding Out Occurs, Higher Government Spending Results in Higher