If the government uses its budget surplus to finance additional government purchases or tax cuts, crowding out will A) occur to a greater degree. B) occur more rapidly. C) not occur. D) still occur, but to a lesser degree.

If the government uses its budget surplus to finance additional government purchases or tax cuts, crowding out will A) occur to a greater degree. B) occur more rapidly. C) not occur. D) still occur, but to a lesser degree.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter30: Government Budgets And Fiscal Policy

Section: Chapter Questions

Problem 52P: If a government runs a budget deficit of 10 billion dollars each year for ten years, then a surplus...

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Please give me correct answer with full explanation; otherwise, i give multiple downvote.

If the government uses its budget surplus to finance additional government
purchases or tax cuts, crowding out will
A) occur to a greater degree.
B) occur more rapidly.
C) not occur.
D) still occur, but to a lesser degree.

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