40. "In general, the Treasury is doing less to "crowd out" private debtors, a phenomenon long considered to be one of the economy's weak points. Savings that would previously have gone into sterile government paper is instead available to ......."

This is best completed with

a) pay higher taxes b) finance exports

c) finance private investment d) increase consumption spending

41. "Another criticism of deficit budgets is that they hamper the private sector's ability to raise capital." This hampering is caused by

a) high taxes b) high bond prices c) high interest rates d) central bank bond purchases

42. "Ordinarily, an increase in the budget deficit raises interest rates, but this does not always happen." This may not happen because

a) the deficit may have been caused by a recession 41

b) the deficit may have been caused by a tax rate decrease

c) the deficit may have been caused by a government spending increase

d) the deficit may have been financed by buying rather than selling bonds