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The crowding-out effect of expansionary fiscal policy suggests that:
Which of the following explains the crowding-out effect?
A. Borrowing and spending related to expansionary fiscal policy will tend to push interest rates upward.
B. Borrowing and spending related to expansionary fiscal policy will tend to crowd foreign investors out of local markets.
C. Borrowing and spending related to expansionary fiscal policy will leave little government resources for essential activities such as national defence.
D. None of the above.