Our Country's Net Exports Will Increase If

question 1

Multiple Choice

Our country's net exports will increase if

• A)there is an increase in domestic income
• B)there is a decrease in the real exchange rate
• C)there is an increase in domestic inflation
• D)many of our trade partners experience inflation
• E)domestic interest rates rise due to expansionary fiscal policy

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Definitions:

Investment Tax Credit

A tax incentive that allows businesses to deduct a certain percentage of their investment in certain assets from their tax liability.

Deficit to Surplus

The process of turning a budget deficit into a surplus by increasing revenues, decreasing expenditures, or a combination of both.

Tax Laws

The legal rules and regulations governing how individuals and entities are taxed by governmental authorities.

Loanable Funds Traded

The marketplace for borrowing and lending, where loanable funds are exchanged, often involving financial institutions, with rates influenced by supply and demand.