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If a Government Increases Its Budget Deficit, Which of the Following

Question 128

Multiple Choice

If a government increases its budget deficit, which of the following best predicts the effects?


A) Interest rates rise and the trade balance moves toward surplus.
B) Interest rates rise and the trade balance moves toward deficit.
C) Interest rates fall and the trade balance moves toward surplus.
D) Interest rates fall and the trade balance moves toward deficit.

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