Which of the Following Is a True Statement Describing Expansionary

Multiple Choice

Which of the following is a true statement describing expansionary fiscal policy's impact in open and closed economies?

A) Expansionary fiscal policy crowds out only investment spending and purchases of consumer durables in an open economy.
B) Expansionary fiscal policy crowds out investment spending, purchases of consumer durables and net exports in an open economy.
C) Expansionary fiscal policy crowds out investment spending, purchases of consumer durables and net exports in a closed economy.
D) Expansionary fiscal policy does not crowd out investment spending and purchases of consumer durables in an open economy.