International trade and money flows can increase aggregate supply and aggregate demand if
A)Trade barriers are increased.
B)Trade barriers are reduced.
C)Tariffs are increased.
D)Quotas are increased.

Question

Quizplus · Accepted Answer

Reducing trade barriers allows for an increase in international trade, which can lead to an increase in aggregate supply and demand. This is because of increased efficiency due to specialization and access to a wider variety of goods at lower prices. Increased trade barriers, such as tariffs and quotas, can lead to a decrease in trade and a decrease in aggregate supply and demand.

International Trade and Money Flows Can Increase Aggregate Supply and Aggregate