Question: Crowding-out effect means (a) government expenditure tends to decrease private investment expenditure because of increase in money supply. (b) government expenditure tends to decrease private

Crowding-out effect means

(a) government expenditure tends to decrease private investment expenditure because of increase in money supply.

(b) government expenditure tends to decrease private investment expenditure because of higher interest rate.

(c) government expenditure tends to encourage private investment because of lower interest rate.

(d) multiplier effect operates in reverse direction.

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