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Assume That a War Breaks Out Abroad,and Foreign Investors Choose

Question 100

Multiple Choice

Assume that a war breaks out abroad,and foreign investors choose to invest more in a large safe country,the United States.Then,according to the basic open-economy model,the U.S.real interest rate:


A) and net exports will both fall.
B) will fall and net exports will rise.
C) will rise and net exports will fall.
D) and net exports will both rise.

Correct Answer:

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