Author Question: In an open economy with strong international trade, increases in government spending are likely to ... (Read 45 times)

mpobi80 · **on:** Jun 30, 2018

In an open economy with strong international trade, increases in government spending are likely to have an overall crowding out effect.

Indicate whether the statement is true or false

Question 2

Suppose a country's net exports equal zero. Which of the following will happen if the volume of imports increases without an increase in the volume of exports?

A) The country will experience a budget surplus. B) The country will experience a budget deficit.
C) The country will experience a trade surplus. D) The country will experience a trade deficit.