Crowding out refers to:

intended investment squeezing unsold inventories

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excess consumer spending competing with foreign demand for U.S. goods

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the demand for exports making U.S. goods for expensive for consumers

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reducing the availability of private capital

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Solution

The correct option is D
reducing the availability of private capital

Crowding out refers to the process by which government deficits reduce the capital available in the economy.

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Demand for which of the following goods does not change with a change in income of the consumer?

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