Consider a Simple Macro Model with Demand-Determined Output

Multiple Choice

Consider a simple macro model with demand-determined output.Suppose the level of exports decreases unexpectedly by $6 billion.If the government wants to restore the initial equilibrium level of output it could,all other things equal,

A) increase its purchases by more than $6 billion.
B) increase its net tax revenues by $6 billion.
C) increase its net tax revenues by less than $6 billion.
D) increase its purchases by $6 billion.
E) decrease its purchases by $6 billion.