We will generally observe that the more open an economy
A) the larger the effect of fiscal policy on output and the larger the effect of fiscal policy on the trade position.
B) the larger the effect of fiscal policy on output and the smaller the effect of fiscal policy on the trade position.
C) the smaller the effect of fiscal policy on output and the larger the effect of fiscal policy on the trade position.
D) the smaller the effect of fiscal policy on output and the smaller the effect of fiscal policy on the trade position.
Question 2
Disposable income equals
A) income minus saving.
B) income minus both saving and taxes.
C) consumption minus taxes.
D) the sum of consumption and saving.
E) none of the above
An open fracture.
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The fiscal policy to counter an inflationary gap is a(n)