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Author Question: Suppose the government has a 1.2 trillion budget deficit. If the government borrows 1.2 trillion to ... (Read 86 times)

Kthamas

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on: Jun 30, 2018
Suppose the government has a 1.2 trillion budget deficit. If the government borrows 1.2 trillion to finance this deficit and finances the rest by printing money, the amount of new money created will be
 
  A) 0. B) 600 billion. C) 1.2 trillion. D) 2.4 trillion.

Question 2

Refer to the scenario above. Plutoland's current account would show a balance of ________.
 
  A) 14 billion B) -6 billion C) -10 billion D) 4 billion


dellikani2015

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Reply #1 on: Jun 30, 2018
Answer to Question 1

A

Answer to Question 2

C


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