If a(n)________________ in government purchases leads to a(n)____________ in interest rates, the effect is called crowding out.

Name: If a(n)________________ in government purchases leads to a(n)____________ in interest rates, the effect is called crowding out.
Brand: Quizplus
Rating: 4.9 (44 reviews)

Question

Quizplus · Accepted Answer

An increase in government purchases can lead to an increase in interest rates due to higher demand for funds, which can crowd out private investment by making borrowing more expensive. This is known as the crowding out effect.

If A(n)________________ in Government Purchases Leads to A(n)____________ in Interest

If A(n)____ in Government Purchases Leads to A(n) in Interest