hich of the following is the best example of Crowding out? Group of answer choices A) None of the other options. B) If US G increases and this is financed through borrowing from foreign lenders, this tends to cause an appreciation of the $. In turn this causes exports to decrease in the short run. C) If US G increases, interest rates fall, thereby causing business investment, I, to increase. D) If US government spending on libraries increases, reading will become more popular, and people then will spend more on books. E) The US government spends more (G increases), therefore they must increase taxes.
hich of the following is the best example of Crowding out? Group of answer choices A) None of the other options. B) If US G increases and this is financed through borrowing from foreign lenders, this tends to cause an appreciation of the $. In turn this causes exports to decrease in the short run. C) If US G increases, interest rates fall, thereby causing business investment, I, to increase. D) If US government spending on libraries increases, reading will become more popular, and people then will spend more on books. E) The US government spends more (G increases), therefore they must increase taxes.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
Which of the following is the best example of Crowding out?
Group of answer choices
A) None of the other options.
B) If US G increases and this is financed through borrowing from foreign lenders, this tends to cause an appreciation of the $. In turn this causes exports to decrease in the short run.
C) If US G increases, interest rates fall, thereby causing business investment, I, to increase.
D) If US government spending on libraries increases, reading will become more popular, and people then will spend more on books.
E) The US government spends more (G increases), therefore they must increase taxes.
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