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      Question

      In case of full Crowding out effect what is the shape of

      the LM curve
      A Horizontal Correct Answer Incorrect Answer
      B Vertical Correct Answer Incorrect Answer
      C Upward Sloping Correct Answer Incorrect Answer
      D Curvilinear Correct Answer Incorrect Answer

      Solution

      In case of vertical LM, government expenditure will not increase output. [Full Crowding out].

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