Expansionary fiscal policy can crowd out private-sector spending; that is, an increase in government spending can reduce consumption and investment.

Name: Expansionary fiscal policy can crowd out private-sector spending; that is, an increase in government spending can reduce consumption and investment.
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Expansionary fiscal policy involves increase in government spending that can lead to higher interest rates and lower private sector spending, which ultimately results in crowding out.

Expansionary Fiscal Policy Can Crowd Out Private-Sector Spending; That Is