Describe how “crowding out” affects other sectors of society, e.g., the business sector, the consumer sector, the banking sector, the international sector.

Depict the last 15 year of the Federal budget deficit and the national debt on separate graphs.
2.Analyze the relationship between the Federal budget deficit and the national debt.
3.How does a Federal budget deficit come into existence? When there is a budget deficit, how does the administration deal with it?
4.When dealing with the budget deficit, tell why the administration should be concerned with “crowding out.”
5.What happens to interest rates, private investment, and consumption if “crowding out” occurs?
Describe how “crowding out” affects other sectors of society, e.g., the business sector, the consumer sector, the banking sector, the international sector.
6.What motives could the administration and Congress have to increase or to decrease the budget
deficit? What impact would each of these have on the elements of society listed in question 5?
7.How could the administration and Congress go about changing the size of the deficit? What
impact would any change have on the current state of the economy (the size of the recessionary gap or the inflationary gap, whichever exists)

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