If a Government Increases Its Budget Deficit, Which Statement Would

question 125

Multiple Choice

If a government increases its budget deficit, which statement would best predict the effects?

• A) Interest rates rise, and the real exchange rate appreciates.
• B) Interest rates fall, and the real exchange rate depreciates.
• C) Interest rates rise, and the real exchange rate depreciates.
• D) Interest rates fall, and the real exchange rate appreciates.

---

Definitions:

Toll-free Hotline

A no-cost telephone service provided by businesses or organizations to offer support, answer queries, or address complaints.

Butterball

A brand name, primarily known for its turkey products, symbolizing quality and tradition in American households, especially during Thanksgiving.

Inbound Telemarketing

The practice of receiving calls from potential customers in response to advertising or promotional activities, aimed at sales, customer service, or support.

Toll-free Number

A telephone number that is billed for all arriving calls instead of incurring charges to the originating telephone subscriber, allowing customers to call a business without incurring a charge.