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In a Normal IS-LM Framework, Crowding Out May Be Avoided

Question 9

Multiple Choice

In a normal IS-LM framework, crowding out may be avoided if


A) banks ration credit
B) the government matches a tax increase with an increase in government purchases
C) the central bank increases the money supply to accommodate fiscal expansion
D) the central bank sells government bonds on a large scale
E) both C and D

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