Suppose the government has a budget deficit of $2 billion.If there is no Ricardo-Barro effect,how much crowding out of investment occurs?
A) More than $2 billion.
B) No crowding out occurs and investment does not change.
C) No crowding out occurs because investment increases.
D) Some crowding out occurs,but less than $2 billion.
E) Exactly equal to $2 billion dollars.
Correct Answer:
Verified
Q61: Since the financial crisis of 2008-09, expected
Q64: A country initially has an equilibrium real
Q69: Q78: The Ricardo-Barro effect argues that the crowding-out Q144: Q145: When there is no Ricardo-Barro effect,a government Q146: Following the financial crisis of 2008-09,the private Unlock this Answer For Free Now! View this answer and more for free by performing one of the following actions Scan the QR code to install the App and get 2 free unlocks Unlock quizzes for free by uploading documents![]()
![]()