If crowding out exists, contractionary fiscal policy will cause ...

[washai]

If crowding out exists, contractionary fiscal policy will cause the aggregate demand curve to shift in by more than indicated by the government spending multiplier.
 a. True
  b. False
  Indicate whether the statement is true or false

Question 2

Which of the following is true?
 a. A decrease in the price of ice cream would cause a decrease in the demand for frozen yogurt, a substitute.
 b. Just as demanders will demand more now if the price of a good is expected to rise in the near future, sellers will supply more now if the price of a good is expected to rise in the near future.
  c. An increase in supply leads to a movement up along the supply curve.
 d. Both technological progress and cost-increasing regulations will increase supply.

[katara]

Answer to Question 1

False

Answer to Question 2

a

[washai]

Gracias!

[LVPMS]

Excellent