The crowding out effect is usually associated with

Name: The crowding out effect is usually associated with
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Question

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The crowding out effect occurs when government borrowing increases, leading to an increase in the rate of interest. This increase in the interest rate can lead to a decrease in private sector borrowing, thereby crowding out private investment. This effect is associated with fiscal policy, particularly expansionary fiscal policy where the government increases its spending or reduces taxes.

The Crowding Out Effect Is Usually Associated with