Crowding out, where businesses and households are forced out of the market for borrowed funds by federal
Question:
Crowding out, where businesses and households are forced out of the market for borrowed funds by federal government borrowing, occurs because businesses and households are sensitive to interest rate changes while the federal government is not. Why is federal borrowing not sensitive to the interest rate? What would be the effect on federal programs if it were sensitive to the interest rate?
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
The government needs to borrow funds every week to purchase goods and servic...View the full answer
Answered By
HARSH RANJAN
Taken classes at college to graduates, Also worked as an expert to a freelancer online question-solving portal for more than 8 months with an average rating greater than 4.2 out of 5.
1+ Reviews
10+ Question Solved
Related Book For 
Economics Theory And Practice
ISBN: 9781118949733
11th Edition
Authors: Patrick J. Welch, Gerry F. Welch
Question Posted:
