If an Increase in the Federal Deficit Stimulates an Economy,_____

Multiple Choice

If an increase in the federal deficit stimulates an economy,_____.

A) an expansionary gap exists in the economy
B) the crowding in of private investment takes place
C) the crowding out of private investment offsets crowding in of private investment
D) the crowding out and crowding in of private investment cancels each other out
E) interest rates increase significantly