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We saw that expansionary fiscal policy can cause the crowding - out effect. What can the Federal Reserve do , if anything, so that there

We saw that expansionary fiscal policy can cause the crowding-out effect. What can the Federal Reserve do, if anything, so that there would be no crowding-out effect associated with fiscal expansion?

Question 7 options:

b. Increase the money supply.

c. Decrease the money supply.

d. Keep the money supply constant.

a. The Fed cannot do anything to avoid the crowding-out effect.

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