In which circumstance is crowding out weakest?

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Question

In which circumstance is crowding out weakest?

Accepted Answer

A deep recession with idle resources and firms unwilling to invest — Award 1 mark. There is no queue of private borrowers to displace, so the objection carries little force in that case.

Answer

An economy with a large stock of national debt

Answer

An economy where funds are fully employed

Answer

A deep recession with idle resources and firms unwilling to invest

Answer

An economy operating at full employment

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