Which of the following statements is true?

a. The crowding-out effect will tend to reduce the magnitude of the effects of increases in government purchases.

b. The crowding-out effect implies that expansionary fiscal policy will tend to reduce private purchases of interest-

sensitive goods.

c. The crowding-out effect can occur as a result of direct effects (e.g., building a library may result in fewer books being purchased on Amazon).

d. The crowding-out effect can occur as a result of financing a deficit that drives up real interest rates and crowds out private consumption and investment spending.

e. All of the above statements are true.