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In an Open Economy Like Canada's, a Policy- Induced Increase

Question 50

Multiple Choice

In an open economy like Canada's, a policy- induced increase in the government's budget deficit tends to


A) crowd out public consumption.
B) depreciate the domestic currency.
C) attract foreign capital and crowd out net exports.
D) attract foreign capital and reduce interest rates.
E) crowd out net exports and reduce interest rates.

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