In the Two-Period SOE Model with Production, If the SOE

Multiple Choice

In the two-period SOE model with production, if the SOE closes off trade with the rest of the world,

A) this must make output go down.
B) this must make investment go up.
C) this makes output go up if the real interest rate goes up.
D) this makes output go up if the real interest rate goes down.
E) this makes output go up only if the government reduces spending.