The term "crowding out" refers to?
اصطلاح "ہجوم باہر" سے مراد ہے؟
- The decrease in private investment that occurs when government borrowing increases
- The increase in private investment that occurs when government borrowing decreases
- The decrease in government spending that occurs when private investment increases
- The increase in government spending that occurs when private investment decreases
Explanation
- The term "crowding out" refers to the decrease in private investment that occurs when government borrowing increases.
- When the government borrows more money from the financial markets to finance its spending, it increases the demand for loanable funds, leading to higher interest rates.
- Higher interest rates make borrowing more expensive for businesses and individuals, reducing their willingness to invest and borrow for private investment projects.
- This phenomenon is known as "crowding out" because government borrowing "crowds out" private investment by competing for available funds in the financial markets.
Related MCQs
کون سا مفروضہ انڈیفرینس کرو کو اصل کی طرف محدب بناتا ہے؟
- Cardinality of utility
- A diminishing Marginal Rate of substitution
- Originally of utility
- None of these
اس سوال کو وضاحت کے ساتھ پڑھیں
وارنٹڈ شرحِ نمو سے کیا مراد ہے؟
- The rate of growth which would make planned investment equal to realized investment
- The rate of growth warranted by the resources at the disposal of the community
- The rate of growth planned by the planning authority of the country
- None of these
اس سوال کو وضاحت کے ساتھ پڑھیں
درج ذیل میں سے کون سی چیز ذاتی آمدنی میں شامل ہوتی ہے لیکن قومی آمدنی میں شامل نہیں ہوتی؟
- Interest on Public Debt
- Dividends
- Wages
- None of these
اس سوال کو وضاحت کے ساتھ پڑھیں
جب کوئی ملک درآمدی محصول لگاتا ہے تو اس کی آفر کرو پر کیا اثر پڑتا ہے؟
- To shift it away from the import-commodity axis
- Nil
- To shift it away from the export-commodity axis
- None of these
اس سوال کو وضاحت کے ساتھ پڑھیں
اسکوانٹ اصل کی طرف کیوں مُنحنی ہوتا ہے؟
- Law of increasing returns
- Law of diminishing returns
- Diminishing marginal rate of substitution between factors
- None of these
اس سوال کو وضاحت کے ساتھ پڑھیں
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