Considering Only Its Direct Effect on Income, the Effect of Monetary

question 113

Multiple Choice

Considering only its direct effect on income, the effect of monetary policy is that:

• A)both expansionary and contractionary policies tend to increase the trade deficit.
• B)both expansionary and contractionary policies tend to decrease the trade deficit.
• C)expansionary policy tends to increase the trade deficit and contractionary policy tends to decrease it.
• D)expansionary policy tends to decrease the trade deficit and contractionary policy tends to increase it.

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