Question

The 'Crowding Out' effect of fiscal policy refers to:

A Government spending increasing private investment.
B Government borrowing leading to higher interest rates, reducing private investment.
C Exports reducing domestic consumption.
D Imports replacing domestic production.
E Public sector enterprises outcompeting private firms.
Practice Next

Hey! Ask a query

🎓
Think You're Ready for RBI Grade B?
RBI Grade B 2026 Phase 1 Memory Based Paper
  • 200 Questions with Detailed Solutions
  • Section-wise Coverage (GA, English, Quant & Reasoning)