An increase in private sector borrowing and spending caused by decreased government borrowing is known as
A)Crowding out.
B)Crowding in.
C)Crowding debt.
D)Debt reduction.

Question

Quizplus · Accepted Answer

Crowding in is a situation where decrease in government borrowing leads to an increase in private sector borrowing and spending. This happens because there is more credit available in the economy, lowering interest rates and encouraging investment by private firms.

An Increase in Private Sector Borrowing and Spending Caused by Decreased