Author Question: Suppose the U.S. Congress is successful in enacting tariffs large enough to eliminate the current ... (Read 34 times)

Beheh · **on:** Jun 29, 2018

Suppose the U.S. Congress is successful in enacting tariffs large enough to eliminate the current account deficit. What would happen to the level of domestic investment?

A) It would not change.
B) It would fall to a level equal to national saving.
C) It would rise and exceed national saving.
D) It would rise to a level equal to net foreign investment.

Question 2

If national saving decreases

A) the sum of domestic investment and foreign investment must increase.
B) the sum of domestic investment and foreign investment must decrease.
C) foreign investment must increase to cover the loss.
D) the sum of domestic investment and net exports must increase.