Crowding out can only exist--according to Liberals--when the economy is at full employment, and all productive resources are being utilized.

Question

Quizplus · Accepted Answer

Liberals believe that crowding out occurs when government spending leads to higher interest rates and reduced private investment, but this can only happen when the economy is at full employment and all resources are being utilized.

Crowding Out Can Only Exist--According to Liberals--When the Economy Is