Which of the situations is an example of the crowding-out effect on investment as it pertains to macroeconomics?

The government of Walla Walla spent $4.3 billion dollars and collected $2.2 billion dollars in tax revenue.

Candex, an eyeglass frame company, decides to cut the price on all of its frames to $10, which successfully drives out all other firms from the market.

The government deficit is at an all-time high in the United States. As such, people begin to save more money in fear that taxes will increase in the future.

Jack wants to borrow money to create a cowboy-themed inflatable bounce house for kids called "Wild Wild West." However, the government is running a deficit which has increased interest rates so much that Jack can no longer afford to borrow the money.

Answers

Answer 1

Answer:

Jack wants to borrow money to create a cowboy-themed inflatable bounce house for kids called "Wild Wild West." However, the government is running a deficit which has increased interest rates so much that Jack can no longer afford to borrow the money.

Explanation:

Crowding-out is when government borrowing results in higher interest rates and less capital available for private investment.

For example, if the government runs a deficit, it must enter the market for loanable funds as a borrow (demander). Holding all else equal, the increase in demand will result in higher interest rates. Due to the interest rate increase, Jack can no longer afford to borrow the startup money needed to create his bounce house business. The government has crowded Jack out of the market by increasing the demand for loanable funds.

Walla Walla is running a budget deficit, which can lead to crowding out, but there is no evidence that investment has been crowded out. Government deficits may lead to increased taxation to bridge the deficit, and people saving more as a result is an example of Ricardian equivalence. Candex is engaging in predatory pricing.


Related Questions

Nepal is facing a huge trade deficit suggest ways to minimize the trade deficit justify the statement​

Answers

Explanation:

Access to transit facility: Nepal is a landlocked country with limited transit facilities. ...

Diversify Nepal's export base: Nepal exports only a few items to a few nations. ...

Industrial sector development: Nepal's industrial sector is still underdeveloped.

What must happen before high quality and high paying jobs can exist?

Answers

Answer:

I think it's union, I don't know tho.

Topic: How should governments balance personal freedoms and security?

Answers

Answer:

it is possible to balance individual rights and personal freedoms with social control and respect for legitimate authority because: Individual rights are the rights that are guaranteed to all American Citizens from the U.S. Constitution, especially the Bill of Rights.

it is possible to balance individual rights and
personal freedoms with social control and
respect for legitimate authority because:
Individual rights are the rights that are
guaranteed to all American Citizens from the U.S.
Constitution, especially the Bill of Rights.

Complete each statement by selecting the appropriate type of fiscal policy.

a. Lowering inflation and increasing unemployment is a goal of __________ fiscal policy.
b. Lowering unemployment and prices is a goal of __________ fiscal policy.
c. Lowering unemployment and increasing inflation is a goal of __________ fiscal policy.
d. __________ fiscal policy focuses on reducing regulations on businesses.
e. __________ fiscal policy involves more government spending money on anything.
f. __________ fiscal policy encourages human and capital development.

WORD BANK
Expansionary
Contractionary
Supply-side

Answers

Answer:

a) Lowering inflation and increasing unemployment is a goal of Contractionary fiscal policy.

b) Lowering unemployment and prices is a goal of Supply-side fiscal policy.

c) Lowering unemployment and increasing inflation is a goal of Expansionary fiscal policy.

d) Supply-side fiscal policy focuses on reducing regulations on businesses.

e) Expansionary fiscal policy involves more government spending money on anything.

f) Supply-side fiscal policy encourages human and capital development.

Explanation:

The goal of contractionary fiscal policy is to reduce inflation. Therefore the tools would be an decrease in government spending and an increase in taxes. This would shift the aggregate demand curve to the left decreasing inflation, but it may also cause some unemployment.

Expansionary fiscal policy is done by increasing government spending or decreasing taxes. It is intended to boost growth to a healthy economic level by reducing regulations on business (reducing taxes).

Expansionary fiscal policy can increase government spending on goods and services, which boosts aggregate demand and leads to increased economic output. Spending on education and on scientific research improve human capital in the form of worker productivity.

Traditional fiscal policy calls for manipulating the government's budget (tax revenues and expenditures) to shift aggregate demand (AD) and return the economy to full‑employment equilibrium.

Contractionary fiscal policy is used to lower inflation by decreasing AD through higher taxes, lower government spending, or both. The unfortunate side effect is that it also lowers real GDP, which increases unemployment.

Expansionary fiscal policy is used during a recession to increase AD through lower taxes, higher government spending, or both, which increases real GDP and lowers unemployment. In this view, what the government actually spends money on is somewhat irrelevant. The idea is to just increase spending, which provides someone with new income, which kicks off the multiplier process. The unfortunate side effect is higher prices.

Supply‑side policies are designed to affect aggregate supply, not aggregate demand. If there is an increase in aggregate supply, the economy will come to a new equilibrium position with both lower unemployment, because real GDP increases, and lower inflation. The unfortunate reality here is that supply‑side policies are not clearly defined and work in the long run, not in the short run.

Specific supply‑side policies include reducing disincentives to work hard and invest, such as reducing income taxes and removing government regulations that lower firms' ability to produce. Education and grants for research and development can also help increase productivity.


The citizens of the country of Kenya Citizens elect members of the national legislature to make the laws of the country, which means the country has what type of government?
A) republic
B) oligarchy
C)direct democracy
D) constitutional monarchy

Answers

A.) It’s a republic

Change the adjective in parentheses into an adverb to complete the sentence. The black car was driven . (careless)

Answers

The black care was driven carelessly

Answer:

carelessly

Explanation:

he is correct

Suppose legislatures announce a tax cut. Please shift the appropriate curve or curves to illustrate the result of this policy.

Answers

Answer:

*see image*

Explanation:

Aggregate demand spending is composed of four components: consumption (C), investment (I), government (G), and the difference of a country's exports and imports (X − M). If a tax cut occurs, this increases C, leading to a rightward shift of the aggregate demand curve. Long‑run aggregate supply and short‑run aggregate supply will not be affected.

An economy is in equilibrium when AD=AS=LRAS.In this economy AS=AS but is not equal to LRAS. When government increases it's spending the aggregate demand rises because government spending is a part of AD, so AD will shift to the right.

what are the methods to establish valid assessment ​

Answers

= Deconstruct the standards

= Align items and levels of thinking

= Take items to the next level with rigor and relevance

= Make assessment part of planning

The methods are given below.

Deconstruct the standardsAlign items and levels of thinkingTake items to the next level with rigor and relevanceMake assessment part of planning

What is the validity assessment method?

Assessment validity refers to the extent that which a test measures what it is supposed to measure. The Standards for Educational and Psychological Testing (2014) defines validity as the “degree to which evidence and theory support the interpretations of test scores for proposed uses of tests”.

What are the different types of validity?

Validity can be demonstrated by showing a clear relationship between the test and what it is meant to measure. This can be done by showing that a study has one (or more) of the four types of validity: content validity, criterion-related validity, construct validity, and/or face validity.

Learn more about valid assessments ​here https://brainly.com/question/24690729

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What was one effect of Latin American tariffs on imports from other countries during the Great Depression?

Imports in Latin America increased.
Exports from Latin American increased.
Manufacturing in Latin America increased.
Unemployment in Latin America increased.

Answers

Answer:

The reduced foreign demand for Latin American goods caused gold and foreign exchange to flow out of Latin America faster than they came in. Thus, internal deflation added to the impact of the collapse of exports. The collapse of exports led to a great fall in employment.

Explanation:

maybe this will help

Enter the temperature shown on the thermometer.

Tokyo, Japan __°F

Answers

Answer:

63°F is the reading on the thermometer

21. What is a republic? [1

Answers

A republic is a type of government that has no king, queen, or other monarch and where the people are sovereign.

Answer:

Bassicly its a state in which supreme power is held by the people and their elected representatives, and which has an elected or nominated president rather than a monarch.

Explanation:

C:

~Chiena

Which ideas from the poem are best reflected in the painting? Check all that apply.

Answers

Can I please have the poem and a picture of the painting so I can answer

The two items that the Arayans brought into India were the Caste System and the religion called Hinduism.
True
False

Answers

Answer:

True

Explanation:

Answer:

True

Explanation:

Which geographic features covered most of Madagascar for much of its
history but have now mostly disappeared?
O A. Deserts
O B. Velds
O C. Glaciers
D. Rain forests
SUBMIT

Answers

Answer:

The answer is :(B)

Explanation:

Answer: D Rain forest

Explanation:

I took the test :D

How has the adaptation of venom envoled?

Answers

Answer:

The primary mechanism for the diversification of venom is thought to be the duplication of gene coding for other tissues, followed by their expression in the venom glands. The proteins then evolved into various venom proteins through natural selection.

Explanation:

does federal governments defer to local authorities to make decisions of local concern?

Answers

Answer: Preemption occurs when law at a higher level of government is used to overrule authority at a lower level. State law can be used to preempt local ordinances

Explanation: The U.S. Constitution gives the federal government certain powers and assigns all other powers to the state governments. State governments establish the local governments within their territories and delegate certain powers to them.

If a person appeals the verdict of their court case, they are asking for the:
President of the United States to pardon them.
jury to reverse their decision.
case to be reviewed by a higher court.
judge to overturn the jury's verdict.
case to be reviewed by Congress.

Answers

Answer:

this is true they are asking for forgiveness

Answer:

. President of the United States to pardon them.

Explanation:

I think thats it


How would you describe the
geography of Venezuela? *

A. rivers and flat land

B. fertile land, beaches, lagoons , and highlands

C. dense forests.

Answers

The answer to your question is B.

What is called "the greatest movement of people in the history of the world"?

A) the importation of slaves from Africa
B) the forced march of eastern Native Americans to Oklahoma territory

C) the original colonization of North America

D) the many millions of people who emigrated to the United States from 1790-1930​

Answers

Answer:

A

Explanation:

Answer:

A

Explanation:

the greatest movement of people in the history of the world"?

what i learned about life and career skills?​

Answers

Answer:

challenges you to give all your best

Financial planning is a complex process and should be done with the assistance of a
professional
True
False

Answers

When it comes to financial planning, things can get quite complicated and might need the help of a professional so this is True.

Is a professional needed for financial planning?

Financial planning might sound easy but it can get quite complicated when one thinks about all financial aspects of their lives ranging from tax and legal issues to creditors.

For this reason, it is usually important that the services of a financial expert is sought out.

Find out more on financial planning at https://brainly.com/question/12890843.

HELLLLLP ME PLEEEASE ( i have a broken leg and missed a month of school)
Which problems did African nations face in the decades following independence?

Answers

Answer: D

Explanation:

because they prided themselves on bringing civilization and developing Africa.

Why is good soil considered a valuable resource in the Midwest?

Answers

Answer:

Because it is good for growing crops which leads to food for the population.

Explanation:

Who does the United Nation represent ?

Answers

Answer:

The United Nations is an international governing body formed in 1945 to increase political and economic cooperation among its member countries.

Explanation: The U.N. grew out of the League of Nations following World War II; now, nearly every country in the world is a member. It has five principal component parts, including the U.N.

:)

Which word signals a descriptive example?
Is
has
show
including

Answers

Answer:

It likely is 'has' because not only is it about to describe something that a certain thing or person looks like or is and has but unlike show the second choice you'd think is a descriptive example because of what it means, show is only a definition of description it is not setting a descriptive example.

what are needed to clean a classroom?​

Answers

Answer:

Empty & Disinfect Trashcans Daily. ...

Limit Touching Doorknobs & Handles. ...

Clean Desks & Tables Daily. ...

Pay Attention to Plastic Surfaces. ...

Develop a "Clean Toy" System. ...

Make Sure Fabric Toys Are Washable. ...

Limit Who Uses Whiteboards. ...

Disinfect High-Touch Technology Often

Question: Who was second in command to the local kings and managed the city-state courts in the Aztec Empire?

Answer Choices:
priests
warriors
chief justices
tlatoanis

Answers

Answer:

Worriors

Explanation:

B is probably the best answer

Answer:

it is chief justices

Explanation:

i got it right myself

According to the permanent income hypothesis, which situations would result in an immediate increase in consumer spending, which would result in an immediate decrease in consumer spending, and which would result in no change in consumer spending?

i. A new technology is discovered that promises an increase in cheap computing power in the future. As a result, expected income rises. Consumer spending will ______________.
ii. Firms announce that they expect more layoffs next year than were previously anticipated. Expectations for the rest of this year, however, do not change. Consumer spending will ______________.
iii. The government unexpectedly gives each person in the economy an extra $1,000 tax refund. However, everyone in the economy expects that exactly this amount, in present value, will have to be paid back in the future in the form of taxes. Consumer spending will ______________.
iv. Researchers announce that they anticipate a breakthrough in the effectiveness of training for low‑skill workers within the next decade. The new training method will allow these low‑skill workers to quickly and cheaply acquire valuable skills that will then place them in better‑paying jobs. Consumer spending will ______________.

WORD BANK:
- immediately increase
- immediately decrease
- not change

Answers

i. Immediately increase
ii. Immediately decrease
iii. Not change
iv. Immediately increase

Which of the following statements BEST represents the Federalists' approach to the Constitution?

A
They wanted the Constitution to give more power to the voice of the people.
B
The wanted the Constitution to include laws that would lower taxes.
C
They wanted the Constitution to include a Bill of Rights.
D
They wanted the Constitution to give more control to the U.S. government.Which of the following statements BEST represents the Federalists' approach to the Constitution?

Answers

The statement that best represented the federalist's approach toward the US Constitution is to provide more control to the US government.

Option D is the correct answer.

What is the meaning of a constitution?

The constitution is a book that defines the duties of the government towards the country and state. It also specifies the fundamental rights of the citizens of the country.

The federalists want to divide the powers between three tiers of the US government so that the rights of the US citizens are protected. The three tiers are the legislative branch, the executive branch, and the judicial branch. The legislative branch makes the laws for the US country, the executive branch is accountable for implementing them, and the judicial branch would check whether the laws are abided by the people of the country or not.

Therefore, the US constitution allows more power to the branches of the US government.

Learn more about the US constitution in the related link:

https://brainly.com/question/23247593

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Question 10 of 10
What is an advantage of taking out a long term loan instead of a short-term
loan?
A Along term loan usually requires no credit check
B. A long term loan usually requires a low debt-to-Income ratio
G. A long term loan usually has a lower total cost
D A long term loan usually has a lower interest rate

Answers

Answer:

D

Explanation:

its the case most of thr time.

Answer:

D. A long term loan usually has a lower interest rate

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