An Expansionary Fiscal Policy

Multiple Choice

An expansionary fiscal policy:

A) puts upward pressure on interest rates causing the government to sell foreign exchange.
B) puts downward pressure on interest rates causing the government to sell foreign exchange.
C) puts upward pressure on interest rates causing the government to buy foreign exchange.
D) puts downward pressure on interest rates causing the government to buy foreign exchange.
E) does not change interest rates causing the government to sell foreign exchange.