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Economics (MindTap Course List)

13th Edition
Roger A. Arnold
ISBN: 9781337617383

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BuyFindarrow_forward

Economics (MindTap Course List)

13th Edition
Roger A. Arnold
ISBN: 9781337617383
Textbook Problem

Give an example of an indirect effect of crowding out.

To determine

Identify one of the indirect effect of crowding out.

Explanation

Generally, the increases in government spending directly decrease the spending of private parties, although there is also some indirect effect of crowding out in an economy. For example, the government spending for a particular program may lead to deficit budget. In such a situation, the government will demand more loanable funds to finance its project...

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