Global crowding out is described in the text to mean the impact of
A) excessive U.S. population growth on interest rates.
B) excessive global population growth on interest rates.
C) an excessive budget deficit in one country on interest rates of another country.
D) an excessive budget deficit in one country on exchange rates.

Question

Quizplus · Accepted Answer

Global crowding out refers to the situation in which an excessive budget deficit in one country causes an increase in interest rates in other countries through the international capital markets. This reduces the availability of credit and investment, "crowding out" private investment and consumption, and slowing economic growth.

Global Crowding Out Is Described in the Text to Mean