The correct answer is option 1: Crowding in. Crowding in refers to the increase in private investment spending that occurs as a result of increased government spending. When the government increases its spending on infrastructure projects, public services, or other areas, it creates more demand in the economy. This increased demand can lead to higher profits and returns on investment, which in turn encourages private businesses to invest more in expanding their operations. This is known as crowding in because the government`s increased spending crowds in or attracts private investment.

Option 2: Deficit financing refers to the practice of a government borrowing money to cover its spending when its expenses exceed its revenue. It is not directly related to the increase in private investment spending.

Option 3: Crowding out refers to the phenomenon in which increased government spending leads to a decrease in private investment spending. This can happen when the government borrows money to fund its spending, which can lead to higher interest rates and reduce private investment.

Option 4: Pumping out is not a recognized economic term and is not related to the increase in private investment spending induced by increased government spending.

In summary, the correct answer is option 1: Crowding in, as it best reflects the increase in private investment spending resulting from increased government spending