In a Two-Period SOE Model with Production, an Increase in Domestic

Multiple Choice

In a two-period SOE model with production, an increase in domestic government spending

A) increases domestic output and increases the current account surplus.
B) increases domestic output and decreases the current account surplus.
C) decreases domestic output and increases the current account surplus.
D) decreases domestic output and decreases the current account surplus.
E) increases domestic output with no change in the current account surplus.