Multiple Choice
A firm produces manufacturing equipment, some of which it exports. Which of the following effects of a budget deficit would likely reduce the quantity of equipment it sells?
A) the change in the interest rate and the change in the exchange rate
B) the change in the interest rate but not the change in the exchange rate
C) the change in the exchange rate but not the change in the interest rate
D) neither the change in the interest rate nor the change in the exchange rate
Correct Answer:
Verified
Correct Answer:
Verified
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