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natka813 [3]
3 years ago
5

The crowding‑out effect describes a scenario in which federal deficit spending causes:

Business
1 answer:
marshall27 [118]3 years ago
7 0

Answer:

INCREASED INTEREST RATES WHICH REDUCES PRIVATE SPENDING.

Explanation:

Crowding out occurs when government increases its spending thus leading to a drop in private spending. It is a deliberate government policy to push out private spending so as to create more funds for loans. This then results in increased interest rates.

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<em>(A) realize financial rewards.</em>

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However, in <em>practicality</em> people adopt business to <em>pursue their own ideas, gain prestige, be their own boss, continue a family tradition and also to realize financial rewards.  </em>

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