Multiple Choice
In a neoclassical economy, if consumption increases as the interest rate decreases, then a $10 billion rise in government spending would:
A) still crowd out exactly $10 billion of investment.
B) crowd out between zero and $10 billion of investment.
C) not crowd out any investment.
D) crowd out more than $10 billion of investment.
Correct Answer:

Verified
Correct Answer:
Verified
Q108: Use the following to answer questions :<br>Exhibit:
Q109: In the classical model with fixed income,
Q110: If the productivity of farmers has risen
Q111: Since 1960, the U.S. ratio of labor
Q112: In the classical model with fixed income,
Q114: In a neoclassical economy, assume that the
Q115: An increase in the supply of capital
Q116: Assume that an increase in consumer confidence
Q117: The real wage is the return to
Q118: The two most important factors of production