Suppose the Rest of the World Experiences an Expansion That

Multiple Choice

Suppose the rest of the world experiences an expansion that causes an increase in foreign income. From the domestic economy's perspective, this foreign income increase will cause which of the following as the domestic economy adjusts to the rise in foreign income?

A) An increase in net exports.
B) An increase in imports.
C) An increase in domestic income.
D) All of the above.
E) Only A and C.