An increase in the government budget deficit?

3836EconomicsMedium

AIncreases the real interest rate and crowds out investment

Bhas no impact on the real interest rate and fails to crowed out investment

Cdecreases the real interest rate and crowds out investment

DNone of these answers

Correct answer

A. Increases the real interest rate and crowds out investment

Explanation

The correct answer is Increases the real interest rate and crowds out investment.

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