Crowding in is more likely to occur,as a consequence of federal deficits,when
A)the economy is overheated
B)interest rates increase significantly
C)a contractionary gap exists
D)the deficits lower expectations about economic growth
E)an expansionary gap exists

Question

Quizplus · Accepted Answer

Crowding in is more likely to occur when there is a contractionary gap because increased government spending can stimulate economic activity by utilizing idle resources, leading to higher demand and potentially boosting private investment.

Crowding in Is More Likely to Occur,as a Consequence of Federal