Crowding out occurs when increased government expenditures causes private expenditures to fall increased money supply causes private expenditures to fall O increased taxes causes private expenditures to fall O increased consumption causes private expenditures to fall Question 38 (1 point) What two types of federal government policy can mitigate cyclical unemployment? O changes in net factor payments and net exports changes in government expenditures and taxes O changes in consumption and investment expenditures O changes in the money supply and interest rates Question 39 (1 point) If the federal government runs large deficits it could cause crowding out through interest rates. However, the Federal Reserve could try to keep interest rates down by increasing the growth of the monetary base. What will be the long-run result of these two policies? O high inflation and high nominal interest rates O high national debt and low interest rates O low nominal interest rates and low unemployment rate O low unemployment rate and low inflation Question 40 (1 point) Which one of the following shocks can decrease prices and cause unemployment to rise? O decrease in private investment expenditures increase in consumption expenditures O decrease in interest rates increase in exports