Considering Only Its Direct Effect on Income, the Effect of Monetary

Multiple Choice

Considering only its direct effect on income, the effect of monetary policy is that:

A) both expansionary and contractionary policies tend to increase the trade deficit.
B) both expansionary and contractionary policies tend to decrease the trade deficit.
C) expansionary policy tends to increase the trade deficit and contractionary policy tends to decrease it.
D) expansionary policy tends to decrease the trade deficit and contractionary policy tends to increase it.