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Suppose Policy Makers Want to Increase NX and Keep Y

Question 17

Multiple Choice

Suppose policy makers want to increase NX and keep Y constant.Which of the following policies would most likely achieve this?


A) a reduction in government spending
B) a real depreciation
C) a reduction in government spending and a reduction in the real exchange rate
D) a reduction in the real exchange rate and a tax cut

Correct Answer:

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