When There Are Credit Market Imperfections,an Increase in Government Debt

Multiple Choice

When there are credit market imperfections,an increase in government debt may be advantageous because it

A) discourages credit-constrained consumers from borrowing too much.
B) increases the welfare of credit-constrained consumers.
C) eliminates the problems that cause credit market imperfections.
D) encourages more private saving.
E) borrow at higher interest rates than consumers.