单选题

According to the crowding-out model, persistent, large government budget deficits are most likely to be associated with a(n)（）。

A、 increase in net exports.
B、 decrease in private spending.
C、 decrease in the real rate of interest.

【正确答案】 B

【答案解析】

The crowding-out model suggests that budget deficits are associated with higher real interest rates, a decline in private investment, an inflow of capital from abroad, appreciation of the domestic currency, and a decline in net exports.