How Do the Multiplier Effect and the Crowding-Out Effect Change

Multiple Choice

How do the multiplier effect and the crowding-out effect change the consequences of an increase in government spending?

A) They both amplify the consequences.
B) They both diminish the consequences.
C) The multiplier effect diminishes the consequences, while the crowding-out effect amplifies the consequences.
D) The multiplier effect amplifies the consequences, while the crowding-out effect diminishes the consequences.