Which of the following will occur in a small country with a high marginal propensity to import?
A) Changes in government spending will cause large changes in output.
B) Changes in government spending will cause large changes in the trade balance.
C) A depreciation will cause only small changes in the trade balance.
D) There is no combination of policies that can eliminate the trade deficit.
E) all of the above
Correct Answer:
Verified
Q35: Which of the following conditions must be
Q36: An increase in which of the following
Q37: An open economy with a low saving
Q38: A change in which of the following
Q39: An increase in domestic demand will have
Q41: For this question,assume that the Marshall-Lerner condition
Q42: For an open economy,which of the following
Q43: For an open economy,which of the following
Q44: Suppose policy makers want to increase Y
Q45: Assume the Marshall-Lerner condition holds.Which of the
Unlock this Answer For Free Now!
View this answer and more for free by performing one of the following actions
Scan the QR code to install the App and get 2 free unlocks
Unlock quizzes for free by uploading documents