Critics contend that the crowding-out effect will be minimal when the economy is in a recession.

Question

Quizplus · Accepted Answer

When the economy is in a recession, there tends to be a greater supply of savings and a lower demand for investment, which reduces the likelihood of crowding out. Additionally, during a recession, the government may increase its spending to stimulate the economy, which can offset any potential crowding-out effects.

Critics Contend That the Crowding-Out Effect Will Be Minimal When