The crowding-out effect from increasing government spending can be avoided if OA People will spend more currently to increase the current money demand. O B. The aggregate supply will decrease also. o People will save more currently to prepare for the expected high tax rate in the future. The Fed keeps selling bonds. OD.

The crowding-out effect from increasing government spending can be avoided if OA People will spend more currently to increase the current money demand. O B. The aggregate supply will decrease also. o People will save more currently to prepare for the expected high tax rate in the future. The Fed keeps selling bonds. OD.

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter24: Fiscal Policy

Section: Chapter Questions

Problem 15P

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