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Crowding out occurs when the government Increases taxes, thus causing a decrease in consumption. Issues debt,...

  1. Crowding out occurs when the government
  1. Increases taxes, thus causing a decrease in consumption.
  1. Issues debt, thus making it more difficult for the private sector to issue debt.
  1. Prints money, which displaces currency.
  1. Business’ face a lower interest rate of their issuance of bonds
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Answer #1

"B"

It occurs when the government in the market borrows more and that will increase the interest rate in the market making it for the private sector in the market to produce more.

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