The Main International Repercussion of Either a Fiscal Expansion or Monetary

question 35

Multiple Choice

The main international repercussion of either a fiscal expansion or monetary contraction is to

• A)raise interest rates and the exchange rate, thereby crowding out net exports.
• B)raise interest rates and lower the exchange rate, thereby crowding in net exports.
• C)lower interest rates and the exchange rate, thereby crowding in net exports.
• D)lower interest rates and raise the exchange rate, thereby crowding out net exports.

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Definitions:

Noncontrolling Interest

A minority stake in a corporation, representing less than half of the voting shares, and therefore not having control over the company.